The Board of Directors of IndusInd Bank, in their meeting held today, considered and approved a proposal to raise Rs3,288cr through a preferential issue of fully paid up 6.275 crore equity shares at a price of Rs524 per share, to a set of marquee investors and the Promoter. The preferential issue is subject to shareholder approval and other necessary approvals. The extraordinary general meeting (“EGM”) of shareholders, to consider the preferential issue, is scheduled to be held on August 25, 2020.
The Bank is already well-capitalized with a CRAR (including Q1FY21 profits) of 15.3% as of 30th June 2020. Subsequent to the proposed capital raise, the post-issue CRAR is estimated to be 16.5%.
The Bank will use this capital to continue to invest in liabilities and asset franchise, technology and infrastructure platforms, to expand reach, product offerings and to improve customer experience whilst ensuring sustainable financial parameters.
Sumant Kathpalia, Managing Director and CEO, IndusInd Bank Limited, said. “We thank our existing shareholders for their continued trust and support and welcome our new shareholders. This capital raise from long term, foreign as well as domestic investors, is strategic for us as this helps us bolster the Bank’s balance sheet and position the Bank well as the economy gradually navigates out of the Covid-19 pandemic. The capital raise also reflects the continued support and confidence that our Promoters have in the Bank. We recognize and value the trust and confidence being placed on us by our shareholders, depositors, customers and rating agencies and are committed to remaining focused on creating value for all our stakeholders.”
In accordance with SEBI ICDR Regulations, the proposed preferential issue shall be completed within a period of 15 days from the date of approval by the shareholders at the EGM.
Morgan Stanley and Citigroup Global Markets India Private Limited acted as financial advisors, and S&R Associates acted as legal counsel to IndusInd Bank Limited.
The Bank will raise capital from the following investors:
|
Name of Investor |
Number of Shares Proposed to be Issued |
Total Capital Proposed to be Raised (Rs. Crore) |
|
Route One Fund I LP |
71,59,788 |
375 |
|
Route One Offshore Master Fund LP |
1,06,93,264 |
560 |
|
ICICI Prudential Life Insurance Company Limited |
1,62,21,374 |
850 |
|
Tata Investment Corporation Limited |
57,25,190 |
300 |
|
AIA Company Limited |
78,30,152 |
410 |
|
Hinduja Capital Limited |
57,03,816 |
299 |
|
IndusInd International Holdings Limited |
94,13,661 |
493 |
|
Total |
6,27,47,245 |
3,288 |
