Private sector mortgage financier HDFC Ltd (Housing Development Finance Corporation) has roped in record 19 merchant banks for its mega Rs 14,000 crore fundraising exercise to shore up its balance sheet.
This has set a new record for India Inc as the appointment of this big a legion (of merchant banks) is the biggest ever taken on board by an Indian corporate for fundraising purposes in the equity capital markets.
The 19 merchant banks shortlisted by HDFC Ltd are Axis Capital, BNP Paribas, Bofa Securities, Citi, Credit Suisse, Goldman Sachs, HDFC Bank, HSBC Securities, ICICI Securities, IIFL Capital, Jefferies, JM Financial, JP Morgan, Kotak Mahindra Capital, Motilal Oswal, Morgan Stanley, SBI Capital, and UBS, sources in the know told Moneycontrol.
Usually, large undertakings engage several merchant banks for big fundraising exercises as they are a complex affair, and may be undertaken in one or more tranches.
Merchant banks are involved in myriad aspects of the transaction such as tapping marque investors, marketing the issue in India and overseas markets, compliance and coordination with several parties comprising regulators, and conducting due diligence and documentation amongst other functions.
Reliance Industries Ltd (RIL) had, earlier this year, appointed a consortium of 14 merchant bankers for its Rs 53,000 crore rights issue, which was the country's biggest ever equity fund raise. The issue kicked off on March 20, 2020.