State Bank of India is understood to have selected five investment bankers to manage its ₹25,000-crore qualified institutional placement (QIP) issue, sources said.

Citigroup, HSBC, Morgan Stanley, Kotak Capital, and ICICI Securities have made it to the final list to manage the issue by charging a token fee of ₹1 for the issue, said the sources with direct knowledge of developments.

Sources added that a number of investment bankers had placed bids to manage the issue, but those quoting the rock bottom rate got the mandate.

Citigroup declined to comment on the matter, while Kotak, HSBC, Morgan Stanley and ICICI Securities had not responded by press time.

There was no response from SBI either to a message sent seeking clarity and confirmation on the developments.

Price bids open

Investment bankers or lead arrangers usually charge up to 1 per cent of the issue amount as their fee in such fund-raising programmes, though their fees are at the lower end of the range for public sector undertakings and where the issue size is large.

However, they have also been known to charge a token fee, as in this case, where being associated with the issue is a matter of prestige.

In 2011, at the time of ONGC’s follow-on public offer merchant bankers had quoted ₹1 fee for the issue. Another instance was in 2017, when a mid-size domestic investment bank had quoted ₹1 to manage a share sale by SBI.

This is one of the biggest QIP issuances by SBI, which had released a request for proposals for the selection of booking running lead managers in May. The lead arrangers will be working alongside SBI’s subsidiary SBI Capital Markets on the share issuance.

The price bids for selecting the lead manager was opened on Tuesday. Tender fees, earnest money deposit and providing bank guarantees were waived for this process.

SBI had previously obtained board approval to raise ₹25,000 crore through QIP, and had said it would appoint up to six merchant bankers as book running lead managers.

Published on June 25, 2025