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Axis Bank raises Rs 12,500 crore through QIP, shares rise 3.5%

BusinessToday.In     September 26, 2019

Axis Bank, country's third-largest private-sector lender, announced it had raised Rs 12,500 crore via Qualified Institutions Placement(QIP) from large local and foreign investors.

With a trend reversal, the share price of Axis Bank rose 3.55% to touch an intraday high of Rs 719.55 on the BSE, following the announcement. Axis Bank stock trades higher than 5, 20 and 50-day moving averages but lower than 100 and 200-day moving averages. Axis Bank stock has outperformed the banking sector by 0.45%, that currently trades 1.25% higher.

"Pursuant to the powers conferred on the Committee by the Board of Directors of the Bank, at its meeting held on July 20 2019, the Qualified Institutions Placement of the Bank opened pursuant to the resolution passed by the Committee on September 19, 2019, be and is hereby declared as closed today, on 25th September 2019."

Private lender Axis Bank had announced the opening of its qualified institution's placement (QIP) last week, in order to raise funds to enhance its capital adequacy for its growth strategy and general corporate purposes.

"We understand that the transaction is the largest ever QIP by a private sector issuer in India," the bank said in a statement.

The regulatory statement added that despite a challenging macro-economic and market environment, the QIP has witnessed strong reception from the global and domestic investor community.

"We wish to inform you that, the Committee of Whole-Time Directors of the bank, at its meeting held today, has considered and approved allotment of 19,87,28,139 equity shares at a price of Rs 629 per equity share (including a premium of Rs 627 per equity share), (which takes into account a discount of 4.91% to the floor price of Rs 661.50 per equity share) aggregating to Rs 1,24,99,99,99,431, to successful eligible Qualified Institutional Buyers in accordance with Chapter VI of the SEBI Regulations," the lender said in a regulatory filing.

Amitabh Chaudhry, managing director and chief executive officer at Axis Bank, said the reception of the QIP is an endorsement of bank and its strong fundamentals.

As of 1415 IST, shares of Axis Bank were trading 1.15% higher at Rs 702.6 apiece on BSE.

By Rupa Burman Roy

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