HDFC Successfully completes its capital raise

On August 11, 2020, Housing Development Finance Corporation Limited ("Corporation") successfully completed its Qualified Institutions Placement of equity shares and non-convertible debentures simultaneously with warrants ("Issue").

The Corporation has raised Rs 10,000 crore through the issue and allotment of 5,68,l8,181 equity share of face value of Rs, 2 eaeh at an issue price of Rs. 1,760 per equity shares. The issue price represents a discount of 1% to the closing price of its equity shares on the BSE/NSE prior to the launch of the Issue.

The Corporation has received Rs. 307.03 crore upfront through the issue and allotment of 1,70,57,400 warrants at an issue price of Rs. 180 per warrant ("Warrant Issue Price"). The warrants entitle the warrant holder to exchange each warrant for one equity share of the Corporation at any time over the next three years i.e. until August 10, 2023, at a pre-agreed price of Rs. 2,165 ("Warrant Exercise Price"). The Warrant Issue Price together with the Warrant Exercise Price represents a premium of 32% to the closing price of the Corporation's equity shares on the BSE/NSE prior to the launch of the Issue.

The Corporation also raised an amount of Rs. 3,693 crore through the issue of redeemable non-convertible debentures at par. for a tenor of 3 years, carrying an annualised coupon rate of 5.40% per annum.

The Issue has been oversubscribed overall. The equity shares and warrants offered in the QIP have been subscribed to by 326 diverse marquee institutional funds.

Of the total equity shares and warrants allotted pursuant to the Issue, 89% have been towards long-only funds and 30% have been allotted to domestic institutional investors.

Assuming all the warrants are exercised by investors within the next three years, the Corporation would receive an additional Rs. 3,690 crore by way of securities premium. Accordingly, the maximum equity dilution possible under the Issue would be up to 4.26% of the enhanced equity share capital of the Corporation.

The proceeds of the Issue wi 11 be used towards general corporate purposes and financing organic and inorganic business opportunities that may arise including funding expansion plans of subsidiary and associate companies of the Corporation.

Shares of HOUSING DEVELOPMENT FINANCE CORP.LTD. was last trading in BSE at Rs.1802 as compared to the previous close of Rs. 1785.15. The total number of shares traded during the day was 73700 in over 3798 trades.

The stock hit an intraday high of Rs. 1822.9 and intraday low of 1787.05. The net turnover during the day was Rs. 133117406.

Source : Equity Bulls

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