Karnataka Bank Shares Surge On Approval Of Rs 1,500 Cr QIP Raise

Karnataka Bank's stock has surged by 2.59 per cent, or Rs 6.25, reaching Rs 247.95 in the morning trading session following the announcement of the board's approval to raise capital of up to Rs 1,500 crore. The stock began the day at Rs 246.50 and reached a high of Rs 249.10, remaining in positive territory at the time of this report.

The bank stated, "The board has approved raising capital up to Rs 1,500 crore in one or more tranches by way of preferential issue/rights issue/QIP or any other permissible mode, subject to necessary regulatory/statutory approvals and shareholders’ approval," in a statement to BSE on 22 September.

Providing further details on the fundraising, the bank added, "As part of tranche 1, the board has approved the issuance of up to 3,34,00,132 equity shares of face value of Rs 10/- each, to HDFC Life Insurance Company, Bajaj Allianz Life Insurance Company, Quant Mutual Fund, Bharti AXA Life Insurance Company, Bajaj Allianz General Insurance Company (“Proposed Allottees”), at a price of Rs 239.52/- per equity share (including premium of Rs 229.52/- per share), amounting to an aggregate of up to Rs 800 crores on a preferential basis."

This surge has contributed to a 2.25 per cent increase in the stock's value over the past five sessions.

Over the last month, the bank's shares have risen by 10.03 per cent, and over the last six months, they have soared by 91.76 per cent. Year-to-date, the stock has seen a remarkable 61.13 per cent increase, while its value has more than tripled, rising by 216.22 per cent over the past year.

Karnataka Bank has significantly outperformed the Nifty 50 benchmark, which has decreased by 2.54 per cent in the last five sessions, increased by 1.95 per cent over the last month, risen by 15.63 per cent over the past six months, climbed by 7.93 per cent year-to-date, and surged by 15.42 per cent over the past year.