News

Punjab National Bank likely to launch QIP within a week to raise Rs 5,000-7,500 crore

Submitted by admin on September 25th, 2024

The Punjab National Bank is expected to launch a qualified initial public offering within one to the week to raise Rs 5,000-7,500 crore.

Pnb is likely to launch the market soon as this week with Rs 5,000-7,500 crore to float equity issue to fund through a qualified institutional placement of the shares. This issue could be offered at a discount of $0.5 -$ 0.6 of the market price. National bank namely Punjab National Bank is planning to bring its QIP or qualified institutional placement within a week, as CNBC Awaaz stated on Monday without disclosing the sources. According to the report, India’s second-largest PSU bank wants to mobilise between Rs 5,000-7,500 crore through the equity issuance.

Apparently, the roadshow has elicited a good demand from the domestic mutual funds which are suggestive of a strong following by investors. This market price is proposed to be through the QIP that is expected to be 5-6% cheaper than the current market price. Shares of PNB inched up by 3 per cent in intraday trade on Monday touching Rs 111.5 levels, tracking other major PSU bank stock such as SBI, BoB, and CBI, up 2-4 per cent.

This comes close on the heels of PNB’s earlier disclosure of its proposal to tap up to Rs 7500 crore through a QIP in the current financial year. Earlier in January the bank’s board had okayed raising up to Rs 7500 crore in 2024-25, and during its Q1- FY 23 earnings the bank revealed that the QIP would be launched in the current quarter. In an interview conducted earlier this month, PNB’s Executive Director Binod Kumar stated that the bank would tap funds this quarter.

“We are already in the roadshow, so it will be very shortly,” Kumar said in an interview with Informist. Kumar also stated that the bank had no near-term plans for further tier-I or tier-II bond issues due to sufficient capital. However, he mentioned that PNB may consider raising funds via infrastructure bonds at a later stage.

PNB’s share price has surged nearly 39 percent over the past year, taking its market capitalisation to over Rs 1.23 lakh crore.

Separately, last week, India’s largest PSU bank, State Bank of India, raised Rs 7,500 crore in its second issue of Basel III-compliant tier-II bonds for FY25, taking its total tier-II bond issuance to Rs 15,000 crore for the current fiscal year.