ICICI Bank, HDFC appoint bankers for fundraising

Both entities are expected to sell securities in 1-2 months as they gear up for a possible spurt in demand for loans once economic activities get back on track after the Covid-19 pandemic. They are taking advantage of a more than 30 per cent rally...

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ET first reported about HDFC’s stake sale on June 5. HDFC is expected to launch its fundraising programme in August.
Mumbai: Two of India’s biggest financial institutions — ICICI Bank and Housing Development Finance Corp — have started the process of raising a combined Rs 29,000 crore in what could be one of the largest instances of capital mobilisation since the global financial crisis.

ICICI Bank, which plans to raise as much as Rs 15,000 crore, has roped in Morgan Stanley and JP Morgan, besides ICICI Securities, as book runners to the share sale, people with direct knowledge of the matter told ET.

HDFC, the country’s largest mortgage lender aiming to raise up to Rs 14,000 crore, has appointed Kotak Mahindra Bank as its lead banker. Citigroup, Morgan Stanley, Jefferies and Bank of America are also said to be helping HDFC, although official mandates are likely this week. Both the lenders are likely to appoint at least six investment banks this week.

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“Kotak has been assigned with the task of documentation primarily as it is the lead banker for HDFC, which will appoint others this week,” said an executive with direct knowledge of the matter.

Both entities are expected to sell securities in 1-2 months as they gear up for a possible spurt in demand for loans once economic activities get back on track after the Covid-19 pandemic. They are taking advantage of a more than 30 per cent rally in stocks, fuelled largely by foreign institutional inflows, from record lows in March.

ET first reported about HDFC’s stake sale on June 5. HDFC is expected to launch its fundraising programme in August.
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ICICI Bank, HDFC and Kotak did not reply to ET’s queries. Morgan Stanley, JP Morgan, ICICI Securities declined to comment on the matter.

ICICI Bank is looking to raise the money through a qualified institutional placement. HDFC will go for a combination of QIP, warrants or non-convertible debentures.

SBICap, JM Financial, Bank of America and HSBC are among the others that could be associated with both or one of the sales, market officials said.

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