Kotak Bank to raise upto Rs 5,800cr via QIP

MUMBAI: Kotak Mahindra Bank has launched a qualified institutional placement (QIP) offer of 6.2 crore shares through which it could mop up about Rs 5,800 crore. The bank has set a floor price of Rs 913.24 per share while market players are expecting the shares could be placed at about Rs 936 per share, almost at the stock’s closing price on Thursday.If successful, the QIP will be the second largest such offer in India behind the Rs 8,032-crore offer by SBI in 2014. This could also turn out to be the largest QIP by a private sector entity ever.
The QIP is part of the RBI-directed plan to cut promoters’ stake in Kotak Bank, in a staggered manner, to 15% by March 2020. Currently the promoters hold 32% in the bank and as per the RBI directive it has to be at 30% by June 30.
On May 9, Kotak Bank’s shareholders had given their consent to issue up to 6.2 crore shares, through public offer, private placement or rights offer including a qualified institutional placement (QIP). Shareholders also allowed the management to raise foreign holding in the bank to 49%.
After the bank issues 6.2 crore new shares, promoters’ stake will come down to about 31%. So in effect, the promoters will have another one and half months to dilute another 1% stake in the bank to comply with RBI’s directive.