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Why Bank of Baroda shares surged over 4% intraday

Bank of Baroda shares rallied as much as 4.44 per cent during the day's trade to hit intraday high of 86.90 after the lender said it has successfully closed the QIP issue

twitter-logoBusinessToday.In | March 3, 2021 | Updated 14:45 IST
Why Bank of Baroda shares surged over 4% intraday
Bank of Baroda share price rises over 4% on Wednesday

Bank of Baroda share price gained over 4 per cent in intraday on Wednesday after the public sector lender said that it has successfully closed the qualified institutional placement (QIP) issue to raise up to Rs 4,500 crore. The Issue opened on February 25 and closed on March 02, 2021.

Bank of Baroda shares opened higher at Rs 84.65 against previous close price of Rs 83.20. The stock rallied as much as 4.44 per cent during the day's trade so far to hit intraday high of 86.90. The PSU bank shares hit its 52-week high of Rs 99.80 on February 19, 2021, while it touched 52-week low on May 20, 2020. The market cap of the bank rose to Rs 39,852.39 crore.

In an exchange filing on Wednesday, Bank of Baroda said its capital raising committee of board of director has approved allotment of 55.07 crore equity shares at the issue price of around Rs 81.70 per share (including a premium of Rs 79.70) against the floor price of Rs 85.98 per share, aggregating to Rs 4,500 crore, pursuant to the Issue. The shares were issued at a discount of 5 per cent (Rs 4.28 per equity share) to the floor price of Rs 85.98 apiece.

Pursuant to the allotment of equity shares in the issue, the paid-up equity share capital of the bank stands increased to Rs 1034.27 crore, comprising of 517.14 crore equity shares, it said.

The lender intends to use net proceeds towards augmenting the bank's Tier I Capital to meet the Basel III norms, support business growth plans and for general corporate requirements.

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