SBI plans to raise Rs 25,000 crore via share sale, check details

State Bank of India (SBI), India's largest lender by assets, is preparing to launch a substantial share sale, targeting Rs 25,000 crore from institutional investors as early as next week. If successful, this qualified institutional placement (QIP) would set a new record in India, exceeding Coal India's Rs 22,560 crore sale in 2015. The bank's board gave the green light in May, yet plans remain tentative and subject to modification, "according to people familiar with the matter". "

SBI didn't immediately respond to Bloomberg queries" regarding this potential landmark transaction.

The driving force behind this substantial share sale is SBI's strategic initiative to support its loan growth, strengthen its balance sheet, and fulfil regulatory requisites. This marks SBI's first foray into equity markets since 2017, making it a significant move for the lender, which is predominantly government-owned. The bank has appointed six investment banks to manage the sale, including Citigroup Inc., HSBC Holdings Plc, ICICI Securities Ltd., Kotak Investment Banking, Morgan Stanley, and SBI Capital Markets Ltd., "Bloomberg News reported earlier". These institutions will play a crucial role in ensuring the success of the transaction, leveraging their expertise and networks.

SBI's QIP is poised to make a marked impact, driven by the bank's strategy to capitalise on the equity market, thereby enhancing its financial structure. The plans are not yet finalised, "according to the people" involved, leaving room for further development.

This major capital raising is intended to secure SBI's growth prospects and compliance with financial regulations. The announcement comes as a significant step for the bank in addressing its capital adequacy needs while aiming for expansion in lending capabilities. This move reflects SBI's commitment to maintaining its leadership position in the banking sector and its proactive approach to financial management.