PSU lender Union Bank of India said on Tuesday that it intends to use a qualified institutional placement (QIP) to fund ₹3,000 crore, with a floor price of ₹142.78 per share.
“We wish to inform you that the Committee of Directors for Raising Capital Funds (“Committee”) has at its meeting held today i.e. February 20, 2024 approved the raising of funds for an amount not exceeding ₹3,000 crore through issue of equity shares through Qualified Institutions Placement subject to the requisite regulatory /statutory approvals,” said the bank in a stock exchange filing.
“We further wish to inform you that the ‘Relevant Date’ for the purpose of the Issue, in terms of the Regulation 171(b)(i) of the SEBI ICDR Regulations, is February 20, 2024 and accordingly the Floor Price in respect of the aforesaid Issue, based on the pricing formula as prescribed under Regulation 176(1) of the SEBI ICDR Regulations is ₹ 142.78 per Equity Share. Pursuant to the SEBI ICDR Regulations, the Bank may offer a discount of not more than 5% on the Floor Price so calculated for the Issue,” the bank said.
Union Bank of India’s net profit for the December quarter increased by a significant 60%, to ₹3,590 crore. This increase was attributed to lower provisioning and higher interest revenue. According to the bank’s regulatory statement, this was a notable improvement over the net profit of ₹2,249 crore recorded in the same quarter of the prior year.
The bank reported total income of ₹29,137 crore for the third quarter of the current fiscal year, a significant rise over the ₹24,154 crore reported for the same period last year. Significantly, the bank’s interest income improved during the current fiscal year’s third quarter, reaching ₹25,363 crore as opposed to ₹20,883 crore during the same period previous year.
