StanChart ropes in six anchor investors

Standard Chartered Plc has raised around Rs 374 crore by roping in six anchor investors for its Indian Depository Receipt (IDR) issue. These investors have subscribed to 36 million IDRs, or 15 per cent of the issue size, at the Rs 104-105 level.

The investors include Reliance Mutual Fund, which has subscribed to 10.57 million IDRs, and ICICI Prudential AMC (9.60 million). The others are HDFC AMC (6.03 million), Franklin Templeton MF (4.80 million), Birla Sun Life AMC (3.55 million) and Sundaram BNP Paribas (1.40 million).

The issue opens for subscription tomorrow with 240 million IDRs on offer in the price band of Rs 100-115. At the upper end of the band, the bank will raise a maximum of Rs 2,760 crore. According to the prospectus, 10 IDRs would represent one share of Standard Chartered Plc listed on the London Stock Exchange.

The proceeds would be used to support the bank's global growth and increase market visibility and brand perception in India. The issue would also widen the bank's investor base and provide it a new source of capital.

The issue is 30 per cent reserved for qualified institutional buyers. Incidentally, insurance companies would not be able to participate, as the Insurance Regulatory and Development Authority has barred them from investing in IDRs, saying investments outside the country are forbidden under the Insurance Act.

While the retail portion has been capped at 30 per cent, 18 per cent of the issue is reserved for non-institutional bidders and two per cent for eligible employees. The issue closes on May 28.

India is an important market for Standard Chartered, accounting for a major portion of its global income. The country contributed 12 per cent to the bank's income in 2009. It contributed $1.06 billion to the bank’s $7.23-billion operating profit last year, only behind Hong Kong.