Syndicate Bank gains after fixing issue price for preferential allotment to government

Syndicate Bank rose 1.11% to Rs 73.10 at 14:35 IST on BSE after the committee of directors fixed issue price for issuance of equity shares on preferential basis in favour of Government of India.

The announcement was made during market hours today, 17 August 2016.

Meanwhile, the BSE Sensex was down 74.65 points, or 0.27%, to 27,989.96.

On BSE, so far 1.75 lakh shares were traded in the counter, compared with an average volume of 4.5 lakh shares in the past one quarter. The stock hit a high of Rs 74.20 and a low of Rs 72.15 so far during the day. The stock hit a 52-week high of Rs 107 on 18 August 2015. The stock hit a 52-week low of Rs 49.40 on 17 February 2016. The stock had underperformed the market over the past one month till 16 August 2016, falling 10.35% compared with 0.82% rise in the Sensex. The scrip had, however, outperformed the market in past one quarter, gaining 13.86% as against the Sensex's 9.4% rise.

The mid-cap state-run bank has equity capital of Rs 798.50 crore. Face value per share is Rs 10.

Syndicate Bank said that a committee of directors at a meeting today, 17 August 2016, fixed issue price of Rs 73.18 per share for the proposed issue of equity shares to Government of India by way of preferential allotment. The bank's board had on 4 August 2016 approved issue of equity shares aggregating to Rs 776 crore to Government of India. Based on the issue price of Rs 73.18 per share, 10.6 crore shares will be issued and allotted to the Government of India. The issue price is at a premium of 0.1% to the ruling price of Rs 73.10.

Government of India currently holds 69.32% stake in Syndicate Bank and after the preferential issue its stake would rise to 72.92%.

Syndicate Bank's net profit fell 73.8% to Rs 79.13 crore on 1.5% rise in total income to Rs 6419.12 crore in Q1 June 2016 over Q1 June 2015.

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