ICICI Bank shares gain 3% after setting floor price for QIP issue

Shares of ICICI Bank gained as much as 3 per cent to Rs 374.15 on the BSE on Tuesday after the private lender launched its qualified institutional placement (QIP), setting the floor price at Rs 351.36 per share.

The bank plans to raise up to Rs 15,000 crore to support business growth and create a buffer to absorb any shock from the economic disruption caused by the coronavirus pandemic. Its board will meet on August 14 to decide the QIP issue price. The floor price is a 3.4 per cent discount to Monday's closing of Rs 364.20..

ICICI Bank has already raised more than Rs 3,000 crore by divesting part of its stake in its insurance subsidiaries (both life and non-life). The rationale provided by the lender for the divestment of stake was strengthening of balance sheet in view of the pandemic.

While there was a fear that bad loans might shoot up once the moratorium on repayments expired, the Reserve Bank of India (RBI) has now given a one-time restructuring window to banks which should soften the pandemic's impact on their asset quality.

ICICI Bank's capital adequacy ratio (CAR) stood at 16 per cent as of June 30, 2020, with tier I at 14.72 per cent. Its asset quality profile improved during the reporting quarter. Gross non-performing assets (GNPAs) declined to 5.46 per cent in Q1FY21, from 6.49 per cent in Q1FY20.

At 9:33, the stock was trading 2.59 per cent higher at Rs 373 as compared to a 0.9 per cent gain in the S&P BSE Sensex. A total of 1.07 crore have changed hands on the counter on the NSE and BSE combined, so far.



Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel