More demand for credit: HDFC Bank to raise $1 billion

More demand for credit: HDFC Bank to raise $1 billion
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First Published: Fri, May 18 2007. 12 45 AM IST
Updated: Fri, May 18 2007. 12 45 AM IST
Mumbai: India’s leading private-sector lender HDFC Bank Ltd said it plans to raise $1 billion (Rs410 crore) by selling shares locally and overseas to meet accelerating credit demand in the world’s second fastest-growing major economy.
In a statement to the Bombay Stock Exchange, the bank said its board has also approved a plan to offer 13.58 million shares to its founders, the Housing Development Finance Corp., to maintain HDFC Group’s stake, currently at 21.56%, the bank said.
The sale to the founder will fetch HDFC Bank about Rs1,390 crore, leaving it to raise Rs2,810 crore from other investors.
The bank, which gives more than half its loans to individuals in a nation of 1.1 billion people, reported 30% loan growth in the year to 31 March. Investors such as Prateek Agrawal expect good demand for bank stocks from investors.
“I don’t see demand being a problem because valuations of Indian banks are below what the Chinese banks raised money at,” said Agrawal, who manages $203 million of equities at ABN Amro Asset Management in Mumbai.
Shares of HDFC Bank, which fell 3.1% since 1 January, rose Rs9.35 or 0.9% to Rs1,036.25 at the 3.30pm closing of BSE.
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First Published: Fri, May 18 2007. 12 45 AM IST
More Topics: Money Matters | Equities |