M&M Financial hits 52-week high after QIP launch

The stock hit a 52-week high of Rs 461, up 5% on the BSE in early morning trade.

Mahindra & Mahindra (M&M) Financial Services hit a 52-week high of Rs 461, up 5% on the BSE in early morning trade, after the company launched its qualified institutional placement (QIP) issue on Thursday.

M&M Financial Services has fixed floor price of Rs 439.63 per share, almost same against Thursday’s closing price of Rs 439.65. The company said it may offer a discount of not more than 5% on the floor price.

The board of directors of the company at its meeting held on November 1, 2017 approved the issuance of up to 24 million equity shares of Rs 2 each through QIP. It proposed to raise about Rs 1,000 crore.

“The company intends to use the net proceeds of the issue to augment its long-term resources to enable it to meet its business growth and funding requirements, investment in its subsidiaries and joint venture, strengthen its capital adequacy and for general corporate purposes,” M&M Financial Services said in a preliminary placement document.

The securities issue committee of the board of directors of the company at its meeting held 30th November, 2017, also approved the allotment of 25 million equity shares to the promoter Mahindra & Mahindra Limited ('M&M'), at the issue price of Rs 422 per equity share, aggregating to Rs 1,055 crore.

At 09:39 AM; the stock was trading 4% higher at Rs 458 on the BSE, against 0.33% rise in the S&P BSE Sensex. A combined 1.37 million shares changed hands on the counter on the BSE and NSE so far.