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Home / Companies / News /  Shriram Transport finance to raise up to Rs2,500 cr through QIP, promoters

Vehicle financier Shriram Transport Finance Co Ltd on Monday said that its board has approved raising funds through a qualified institutional placement (QIP) offering and capital infusion from its promoter entity Shriram Capital Ltd.

Shriram Capital will invest Rs500 crore in the company through a preferential allotment of equity shares and warrants, the company informed the stock exchanges.

A person aware of the company’s fundraising plans said that the vehicle financier is aiming to raise as much as Rs2,000 crore through the QIP offering.

The company has fixed a floor price of Rs1,433.32 apiece for the QIP offering, as per a Sebi formula. Under the QIP mechanism, companies are allowed to offer a discount of up to 5% on the floor price to investors.

The issue price for the shares and warrants to be subscribed by Shriram Capital has been fixed at Rs1,440 per share.

On Monday, shares of Shriram Finance closed trading at Rs1,490.1 apiece, up 4.64% on the BSE.

“Subject to compliance with applicable laws and regulations, our Company intends to use the Net Proceeds towards augmenting our long term resources for meeting funding requirements of our business activities, financing the future growth opportunities and general corporate purposes," the lender said in an offer document filed with the stock exchanges.

Investment banks ICICI Securities, JP Morgan and Axis Capital are advising the company on the QIP offering.

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