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Housing finance major HDFC’s board on Monday granted its approval for a ₹45,000-crore borrowing programme even as its associate company HDFC Bank said it is raising up to ₹15,500 crore through Qualified Institutional Placement (QIP) and issue of American Depository Receipts (ADRs).
HDFC’s borrowing programme will entail the issue of secured redeemable non-convertible debentures (NCDs) aggregating ₹35,000 crore and External Commercial Borrowing (ECB) up to $1.5 billion (₹10,300 crore). The Corporation is raising the monies to meet the funding requirements for its business.
The housing finance company said the NCD issuance on a private-placement basis will be under a shelf-disclosure document, in terms of the SEBI (Issue and Listing of Debt Securities) Regulations, 2008.
HDFC will raise via ECB up to $1.5 billion from financial institutions, banks, multilateral financial agencies, mutual funds, body corporate, firms, association of persons or such other entities, subject to approval of the Reserve Bank of India.
HDFC Bank share sale
HDFC Bank said in a regulatory filing after a meeting of its Committee of Directors (CoD) that the floor price for its share sale has been set at ₹2,179.13 per equity share.
The CoD authorised the opening of QIP and ADR offering on Monday.
For the QIP, the Committee may, at its absolute discretion, offer a discount of not more than 5 per cent on the floor price, it further said.
The QIP of equity shares have a face value of ₹2 each, while each ADR represents three equity shares of the bank. This will be one of the largest such placements since State Bank of India raised ₹15,000 crore through a QIP in June last year.
The board of directors of HDFC Bank had in December last year approved a proposal to raise ₹24,000 crore to help strengthen its capital buffers and fuel its growth plans. The proposal was also cleared by the Union Cabinet in June this year.
Paresh Sukthankar, Deputy Managing Director, HDFC Bank, had said then that “...The additional capital will go a long way in supporting our growth plans over the next few years, especially in semi-urban and rural India.”
Of this, the lender had earlier this month raised ₹8,500 crore from its promoter HDFC through preferential allotment of shares.
HDFC Bank had raised ₹10,000 crore in February 2015 through a combination of QIP and ADRs.
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