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HDFC to raise up to Rs 13,000 cr via equity, convertible instruments

HDFC needs to participate in HDFC Bank's preferential offer not exceeding Rs 8,500 crore to maintain roughly its shareholding in the latter

Advait Rao Palepu & Abhijit Lele  |  Mumbai 


(HDFC), the country’s largest mortgage lender, is planning to raise up to Rs 13,000 crore by issuing equity shares and other securities. It will use the proceeds to invest up to Rs 8,500 crore in Bank to retain its stake at 21 per cent in the latter. It will also invest in healthcare insurance, buy distressed assets, fund inorganic growth in the affordable housing finance sector, and support growth plans of subsidiaries. The board of directors of at its meeting on Tuesday gave approval for raising funds by issuing equity shares and/or other permissible securities of an amount not exceeding Rs 13,000 crore. The money will be raised through a preferential issue, qualified institutional placement, or any other “permissible mode or combination”, subject to necessary shareholder and regulatory approvals, said in a statement on Tuesday. Elaborating the objectives of raising capital, Vice-Chairman and Chief Executive said the proposed to raise further capital. needs to participate in Bank’s preferential offer not exceeding Rs 8,500 crore to maintain roughly its shareholding in the latter. The corporation, together with its wholly owned subsidiaries, holds 21.01 per cent of the paid-up equity share capital of Bank. did not participate in the last equity issue of private lender in February 2015. HDFC, along with its subsidiary ERGO General Insurance Company, was exploring opportunities in the health insurance sector, he said. Mistry said was evaluating opportunities in acquiring and resolving stressed assets in The plan is to acquire incomplete and half-completed projects.

It will complete the projects and use HDFC’s brand to sale space. The corporation has set up funds for investing in the equity and mezzanine debt of affordable housing projects. It has committed sponsor support to these funds. It might require capital in some of its subsidiary including ERGO General Insurance Company, Education and Development Services, and Credila Financial Services.

First Published: Wed, December 20 2017. 02:20 IST