HDFC to raise up to ~13,000 cr via equity, convertible instruments
Housing Development Finance Corporation (HDFC), the country’s largest mortgage lender, is planning to raise up to ~13,000 crore by issuing equity shares and other securities.
It will use the proceeds to invest up to ~8,500 crore in HDFC Bank to retain its stake at 21 per cent in the latter.
It will also invest in healthcare insurance, buy distressed real estate assets, fund inorganic growth in the affordable housing finance sector, and support growth plans of subsidiaries.
The board of directors of HDFC at its meeting on Tuesday gave approval for raising funds by issuing equity shares and/or other permissible securities of an amount not exceeding ~13,000 crore.
The money will be raised through a preferential issue, qualified institutional placement, or any other “permissible mode or combination”, subject to necessary shareholder and regulatory approvals, HDFC said in a statement on Tuesday.
Elaborating the objectives of raising capital, ViceChairman and Chief Executive Keki Mistry said the private bank proposed to raise further capital.
HDFC needs to participate in HDFC Bank’s preferential offer not exceeding ~8,500 crore to maintain roughly its shareholding in the latter.
The corporation, together with its wholly owned subsidiaries, holds 21.01 per cent of the paid-up equity share capital of HDFC Bank. HDFC did not participate in the last equity issue of private lender in February 2015.