InvestorQ : Why is Axis Bank raising Rs.10,000 crore through sale of equity right now?
Mary Joseph made post

Why is Axis Bank raising Rs.10,000 crore through sale of equity right now?

Answer
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sara Kunju answered.
1 month ago


As the uncertainty cloud over banks has been rising, India’s third largest private bank, Axis Bank, has launched its Rs.10,000 crore QIP placement on 04 August. These will be placed privately with qualified institutional buyers. The floor price of the issue has been set at Rs.442.19 per share and Bain Capital was likely to get preferential allotment in the issue.

The allotment price is 4% higher than the closing price of Axis Bank on Tuesday, which was probably factoring in the dilution due to the QIP placement. Axis Bank net profits had fallen 19% on a YOY basis due to the lag effect of the pandemic. This issue will boost the Axis Bank’s Tier-1 capital ahead of moratorium withdrawal, which is a significant tail risk.