Private sector lender IDFC First Bank Ltd. launched a Qualified Institutional Placement on Tuesday to raise funds, confirming a CNBC-TV18 newsbreak from earlier in the day.

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The floor price of the QIP has been set at Rs 94.95 apiece, which is nearly the same as the lender's closing price on Tuesday.

The bank, at its discretion, may offer a discount of not more than 5 percent on the floor price of the issue, the exchange filing said.

IDFC First Bank's committee will meet again on October 6 to determine the issue price of the equity shares to be issued to eligible investors and the number of shares to be allotted to qualified institutional buyers.

Earlier on Tuesday, CNBC-TV18 had reported that the bank is likely to launch its QIP with an aim to raise Rs 3,000 crore.

CNBC-TV18 had also learned that the bankers for the QIP include a mix of domestic and foreign names.

Sources have now told CNBC-TV18 that the base size of the QIP is worth Rs 2,000 crore with a greenshoe option of another Rs 1,000 crore.

The indicative price of the QIP is said to be Rs 90.25 per share, which is a 4 percent discount to the stock's closing price on Tuesday, according to the sources, who also said that the QIP will result in a dilution of 3.3 percent equity at base size and 4.94 percent including the greenshoe option.

IDFC First Bank plans to use the proceeds to enhance the capital adequacy requirements and for future business opportunities, the sources added.

IDFC First Bank had raised Rs 3,000 crore via QIP back in 2021 at an issue price of Rs 57.35 per share. The shareholders had approved the lender's plan to raise funds in the annual general meeting (AGM) on August 31 this year. The approval is valid for one year.

Last month, US-based boutique investment firm GQG Partners acquired a 2.6 percent stake in the lender for Rs 1,527 crore. Cloverdell Investment, the largest public shareholder in the private lender, had offloaded as much as 4.2 percent or 27.9 crore shares at an average price of Rs 89 per piece. It later purchased another 5 crore shares from the bank's MD & CEO V Vaidyanathan.

The number of shares that exchanged hands amounted to 0.8 percent of the company's total equity.

Shares of IDFC First Bank ended 1.3 percent lower at Rs 94.25. The stock is up close to 60 percent so far this year.

(Edited by : Hormaz Fatakia)

First Published:Oct 4, 2023 4:59 AM IST