InvestorQ : What is HDFC planning to raise funds to the tune of Rs.12,000 crore for?
Arti Chavan made post

What is HDFC planning to raise funds to the tune of Rs.12,000 crore for?

Answer
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3 months ago


HDFC is gearing up for a massive fund raising plan of Rs.12,000 crore spread over a number of tranches through the year to shore up its capital ahead of an expansion in its credit book. The amount of Rs.12,000 crore will be raised through a combination of qualified institutional placement and the issue of non-convertible debentures. It may also explore the global route and raise funds via warrants. While the QIP component is slated to be around Rs.7000 crore, the convertible component could be closer to Rs.5000 crore. The major priority for HDFC is to strengthen its balance sheet through fund-raising so as to boost its capital buffers. This will provide the much needed cushion in case of asset quality concerns. In fact, what is true of HDFC could be a true of many banks and financial players as they look to raise funds quickly to accommodate slips in asset quality once the moratorium is lifted. This is a real fear because the stress is expected to show once the people are asked to pay the EMI with the accumulated interest on the same. HDFC has informed the exchange that the meeting would be held on June 19 to seek shareholder nod for the same.