Central Bank of India gains on fund raising plan

Central Bank of India rose 2.27% to Rs 67.55 at 10:43 IST on BSE after the bank said that a special committee of the board has approved raising funds by issuing equity shares.

The announcement was made after market hours yesterday, 2 March 2016.

Meanwhile, the BSE Sensex was up 250.59 points, or 1.03%, to 24,493.57.

On BSE, so far 1.57 lakh shares were traded in the counter, compared with an average volume of 59,764 shares in the past one quarter. The stock hit a high of Rs 70.20 and a low of Rs 66.90 so far during the day. The stock hit a 52-week high of Rs 114.80 on 12 May 2015. The stock hit a 52-week low of Rs 48.20 on 17 February 2016. The stock had outperformed the market over the past one month till 2 March 2016, riisng 7.22% compared with 1.21% decline in the Sensex. The scrip had also outperformed the market in past one quarter, falling 6.31% as against Sensex's 7.18% fall.

The large-cap company has an equity capital of Rs 1658.27 crore. Face value per share is Rs 10.

Central Bank of India said that the Capital Raising Committee of the board of directors of the bank at its meeting held yesterday, 2 March 2016, approved raising of additional equity capital by issuance and allotment of upto 3.14 crore equity shares of the face value of Rs 10 each at the issue price of Rs 52.66 per equity share, aggregating to Rs 165.56 crore to Life Insurance Corporation of India (LIC) on preferential basis, subject to statutory approvals. The committee also decided to hold an extraordinary general meeting (EGM) of shareholders on 30 March 2016 to seek their approval for the proposed fund raising.

Further, the committee also noted that the bank has sought approval of Government of India (GoI) for raising additional equity capital by conversion of entire 5,830 innovative perpetual debt instruments (IPDI) of the face value of Rs 10 lakh each, aggregating to Rs 583 crore, held by GoI, into equity shares to be issued and allotted to GoI on preferential basis. The bank has also sought approval of GoI for raising additional equity capital of such sum as may be sanctioned by GoI by issuance and allotment of equity shares to GoI on preferential basis. The conversion price and the issue price will be Rs 70.71 per equity share, including premium of Rs 60.71 per equity share, the bank said. The announcement was made after market hours yesterday, 2 March 2016.

Central Bank of India reported net loss of Rs 836.62 crore in Q3 December 2015 as compared with net profit of Rs 137.65 crore in Q3 December 2014. Operating income fell 1.7% to Rs 6911.62 crore in Q3 December 2015 over Q3 December 2014.

As per the shareholding pattern of the bank, the government of India held 81.46% in the bank as on 31 December 2015.

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