Canara Bank surges 7% as Rs 2,000 crore QIP opens for subscription

The board has approved the floor price for the QIP at Rs 103.50 per equity share.

Shares of Canara Bank gained 7 per cent to Rs 126 on the BSE in the early morning trade on Tuesday on the back of heavy volumes after the bank’s qualified institutional placement (QIP) opened for subscription.

The subcommittee of the board – capital planning process of the Bank has, at its meeting held on December 7, has approved and authorised the opening of the QIP, from December 7, 2020. It has also approved the floor price for the QIP at Rs 103.50 per equity share.

The bank had received shareholders' nod in its annual general meeting, held in August, for raising up to Rs 2,000 crore by way of QIP.

“The Bank intends to utilise the net proceeds towards augmenting our Bank’s Tier I Capital to support growth plans and to enhance the business of Bank; and/ or, general corporate requirements or any other purposes, as may be permissible under the applicable law and approved by our Board or its duly constituted committee,” Canara Bank said in preliminary placement document.

In the past one month, the stock has outperformed the market by surging 36 per cent, as compared to a 9 per cent gain in the S&P BSE Sensex. At 09:45 am, it was trading 6 per cent higher at Rs 125, against a 0.52 per cent rise in the benchmark index. A combined around 24 million equity shares changed hands on the counter on the NSE and BSE.