NEW DELHI: Housing Development Finance Corp Ltd plans to raise Rs 8,000 crore to create capital buffers to deal with the uncertainties caused by the economic fallout of the coronavirus outbreak, financial daily reported.
"It's better to be overcapitalised in these difficult times. Profits are not going to come fast and accretion to net worth will be slow," the report quoted a person close to the company.
HDFC is in talks with various investment banks to decide on how to raise the capital-- through sale of shares to qualified institutional investors, sale of warrants, or a rights issue. The company's board is likely to take a final decision after its subsidiaries declare their quarterly earnings, according to the report.
"The plan is to raise 5,000- 8,000 crore (50-80 bln rupees), through a dual tranche of QIP (qualified institutional placement), warrant issuance and a rights issue subsequently. The money will be used mainly to prepare the housing finance company to deal with higher provisioning costs and also to expand inorganically...," the report said.
