Shares of Karnataka Bank climbed over 4 percent in morning trade on October 27 after the lender announced raising Rs 800 crore from five institutional investors by allotting shares on a preferential basis.
At 9.50 am, shares of the company were trading 4.41 percent up at Rs 231.80 on the BSE.
According to an exchange filing on October 26, the bank’s board approved the allotment of 3,34,00,132 equity shares to HDFC Life Insurance Company, Bajaj Allianz Life Insurance Company, Quant Mutual Fund, Bharti AXA Life Insurance Company and Bajaj Allianz General Insurance Company.
The allotment happened at a price of Rs 239.52 per equity share on a preferential basis. The bank received 99.79 percent favourable votes from its shareholders for this preferential issue.
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"We are happy to have completed a successful capital raise through Pref Allotment of Rs 800 crore to five marquee institutional investors,” said Srikrishnan H, MD and CEO of Karnataka Bank. “This is a major step in our transformation journey providing us the growth capital that will facilitate all our developmental activities.”
Sekhar Rao, Executive Director of Karnataka Bank, said, this capital raise is a significant milestone in its journey towards growth and will help fortify its position in the market.
“The capital infusion will bolster Karnataka Bank's financial position, providing the necessary resources to innovate and meet the evolving demands of the market. This development is a testament to the bank's unwavering dedication to excellence and the confidence it has earned among its stakeholders,” he added.
NovaaOne Capital acted as an exclusive financial advisor to the Bank on this fundraise.
Karnataka Bank is scheduled to announce its Q2 results on November 2, 2023.
Shares of the company are up 50 percent on YTD basis, while the 1-year return stands at 144 percent.
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