ICICI Bank lines up Rs 3,000-3,500-cr mega equity issue

The bank’s deputy managing director, Kalpana Morparia said that capital will be used effectively to expand the range of the bank’s business and achieve higher growth. “A well capitalised bank is a global trend,” she said.

In particular, the bank will use the capital in developing further its retail finance, insurance, infrastructure and international operations. “We are working on the premium and lead-managers and would be announcing this shortly,” she said, adding that the whole issue of expansion of capital has to be perceived from a higher growth point of view rather than from a equity-dilution perspective.

The markets expect a price band of Rs 280 to Rs 300 for the forthcoming issue. There may also not be so much appetite for the issue, feel sources. On BSE, the bank’s scrip closed at Rs 345.75 on Tuesday from its overnight close of Rs 330. The current EPS of the bank is pegged at Rs 25.70.

The bank believes that the local financial sector has robust growth prospects. The demand for credit is expected to grow significantly with continued economic growth, upward migration of household income and soft interest rate regime. The bank had gone public in 1997 and in March 2000 raised $175 million through an ADR issue and got listed on the New York Stock Exchange.