IndusInd Bank to raise Rs 3,288 crore through preferential issuance of equity

IndusInd Bank has decided to raise Rs 3,288 crore through a preferential issue of fully paid up 6.275 crore equity shares at a price of Rs 524 per share, through a set of marquee investors and the Promoter.

IndusInd Bank will use this capital to continue to invest in liabilities and asset franchise, technology and infrastructure platforms, to expand reach, product offerings, etc. Photo: PTI

IndusInd Bank has decided to raise Rs 3,288 crore through a preferential issue of fully paid up 6.275 crore equity shares at a price of Rs 524 per share, through a set of marquee investors and the Promoter. The Board of Directors of IndusInd Bank Limited (“Bank”), in their meeting held yesterday, considered and approved the proposal in this regard. 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 25 August 2020.

Speaking on the fund raise through preferential issue Sumant Kathpalia, Managing Director and CEO at 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. The Bank is already well capitalized with a CRAR (including Q1 FY21 profits) of 15.3 per cent as of 30th June 2020. Subsequent to the proposed capital raise, the post-issue CRAR is estimated to be 16.5 per cent.

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The IndusInd 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.

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