JM Financial launches Rs 760 crore QIP offer despite challenging market

MUMBAI: Domestic financial services firm JM Financial is raising about Rs 760 crore or around $100 million, through an institutional placement of equity shares. The offer was launched on Tuesday. JM Financial is the first non-banking finance company (NBFC) that belongs to the sector that was one of the most battered ones in the current Covid pandemic, to raise funds through the stock market route in over three months.The minimum issue price has been fixed at Rs 66.72 per share, the company informed the bourses.
Since March this year, the time the Covid pandemic started spreading in India, some other NBFCs have raised funds, but all those were through the debt market route with most backed by the RBI’s special window christened Targeted Long Term Repo Operation (TLTRO).
“It (JM Financial’s QIP) is a testimony to the confidence of the management as well as of the investors’ to the company’s financial and business strength…the funds from the QIP will be used for regular business growth and in case of any exigency during the current market environment,” a source said.
On Tuesday, the JM Financial stock on BSE closed at Rs 71 and the qualified institutional placement (QIP) offer is expected to be priced around that price, sources said. IDFC Securities and ICICI Securities are managing JM Financial’s QIP offer.
In Tuesday’s board meeting the company got the requisite approval for the QIP offer, including the floor price, date of opening of the offer and also the preliminary offer document that is to be placed with the prospective investors. The company has already started the road show for the QIP offer, sources said.