The shares of this small-cap company surged around 9 percent after they initiated a Qualified Institutional Placement (QIP) to raise a substantial amount of capital worth Rs. 750 crores. The stock has given a multibagger return of 142 percent to its shareholders on a YTD basis.
With a market capitalization of Rs. 13,961 crores, the shares of Jammu and Kashmir Bank Ltd started Tuesday’s trading session positively at Rs. 126.05 compared to its previous close at Rs. 125.20. The share hit a high of Rs. 140, gaining around 9 percent and is currently trading at Rs. 134.90.
Such a bullish movement in the share price was observed after the company in an exchange filing mentioned that they have initiated a Qualified Institutional Placement (QIP) intending to raise a substantial amount of capital worth Rs. 750 crores. This move comes as part of the company’s strategic efforts to bolster its fuel growth initiatives and financial position.
Earlier this year in July, the board of J&K Bank had formally approved to raise funds through QIP. The board set the floor price for the issue at Rs. 112.66 per share, reflecting a discount of 10.02 percent from the company’s previous closing price of Rs. 125.20 on the National Stock Exchange.
Coming onto the company’s financial statements, interest income(revenue) increased by 4 percent from Rs. 2,657 crores during the June quarter to Rs. 2,764 crores in the September quarter. In addition, during the same timeframe, the net profits improved by 16 percent from Rs. 331 crores to Rs. 384 crores.
In FY23, The bank allotted 2.9 crores of equity shares at Rs. 32.70 (at a discount of 5 percent) to the Qualified Institutional Buyers (QIB) aggregating to Rs. 93 crores. As of March 31, 2023, the Bank has 990 Branches spread over 18 states and 4 union territories. The bank remains largely rural-focused, with 55 percent of the total branches in rural areas, followed by 18 percent in the metro, 16 percent in semi-urban, and the remaining 11 percent in urban locations.
Headquartered in Srinagar, Jammu and Kashmir Bank Ltd was incorporated in 1938. It is a publicly held banking company engaged in providing a wide range of banking services including Retail Banking, Corporate Banking, and Treasury Operations.
Written By Vaibhav Patil
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