Equity increase of Rs 11,626 crore for Axis Bank

Axis Bank recently announced that it will raise equity and equity-linked capital of Rs 11,626 crore by selling shares and warrants to a group of marquee investors including Bain Capital and country’s largest insurer and Axis Bank’s promoter Life Insurance Corporation (LIC). In a filing with stock exchanges Axis Bank said, “entities affiliated to Bain Capital propose to invest Rs 6,854 crore and LIC has proposed to invest Rs 1,583 crore. The bank proposes to raise Rs 9,063 crore through issuance of equity and the remaining Rs 2,563 crore through issue of warrants.” The Board had approved the sale of up to 172.63 million shares at 525 rupees each, and 45.36 million convertible warrants at 565 rupees each on a preferential basis and it has received approval for the capital raise from its Board of Directors on November 10, 2017. Despite the rise in bad loans Axis Bank’s capital adequacy ratio stood at 16.32 % of assets at the end of September. The bank plans to raise 90.63 billion rupees from the share sale and 25.63 billion rupees from the sale of warrants. Affiliates of Bain Capital will invest 68.54 billion rupees in the bank, while LIC, which is owned by the Indian government and already owns a stake in Axis, will invest 15.83 billion rupees.