This S&P BSE Smallcap bank stock has a market cap of Rs. 7,940 crore and is classified under the private sector. The stock has risen 5% currently to Rs. 253.90 versus Rs. 241.70 at previous close.

The stock trades 3% away from its 52 week high of Rs. 257.70 and 10%, 53% above its 20 day and 200 day moving averages respectively. 

Karnataka Bank Ltd (“Karnataka Bank”) has been on an uptrend since early April 2022 and in a filing dated 22nd September 2023 the company stated that it intends to issue equity share capital up to Rs. 1,500 crore out of which Rs. 800 crore on a preferential basis which the board approved in  meeting held on the day. 

Further, out of which 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 Limited, Bajaj Allianz Life Insurance Company Limited, Quant Mutual Fund, Bharti AXA Life Insurance Company Limited, Bajaj Allianz General Insurance Company Limited, at a price of Rs. 239.52 per share (including premium of Rs. 229.52/- per share), amounting to an aggregate of Rs. 800 crore in complete cash consideration. 

The proposed issue will assist the bank in bolstering its financial base in preparation for future expansion. The bank’s expanding business will primarily use the proceeds of this issue to meet its needs, including long-term capital requirements and general corporate purposes. The exclusive financial advisor to the bank on this issue is NovaaOne Capital, a merchant banker registered with SEBI. 

Mr. Srikrishnan H., MD & CEO of Karnataka Bank, stated, “This capital infusion marks a pivotal moment in our journey. It reflects our commitment to fortify our position in the market and better serve our customers. We are confident that this strategic step aligns with our vision for growth and stability.”

Written by Sandeep R


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