The country's largest lender, SBI, plans to raise Rs 45,000 crore from the capital markets. Of this, Rs 25,000 crore will be raised through a qualified institutional placement (QIP) this week, making it the largest equity issuance of its kind in India. Given the current market capitalization of nearly Rs 7.4 lakh crore, the issuance would result in a 3.3% equity dilution.
Key Highlights
- SBI plans ₹25,000 cr QIP at ₹811.05 floor price, alongside ₹20,000 cr bond issuance.
- Rs 45,000 cr mega‑fundraise—the nation’s largest—combines equity dilution (3.3%) and Basel III‑compliant debt drive.
The bank launched the share sale on Wednesday, following board approval on May 3 and shareholder consent on June 13. The shares, which have a face value of Re 1, will be issued in accordance with the SBI Act and its General Regulations. Coal India's Rs22,560 crore issue in 2015 was the largest equity fundraising through QIP to date. If SBI's placement is fully subscribed, it will exceed this limit.
The offer's floor price is Rs 811.05 per share, calculated using Sebi's pricing formula. The bank may provide a discount of up to 5% on this price. The final price will be determined after consulting with the book-running lead managers. The pricing is based on the relevant date, July 16.
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SBI has filed a preliminary placement document with the BSE and NSE. The offer is limited to qualified institutional buyers. The bank has closed its trading window for individuals designated under its insider trading code. In addition to the equity offering, the bank intends to raise Rs 20,000 crore through bonds that comply with Basel III standards. These will be issued in Indian rupees to domestic investors. The plan is subject to government approvals, where applicable. The bank will raise bond capital in tranches based on market conditions. AT1 bonds will help Tier 1 capital, whereas Tier 2 bonds will improve overall adequacy.
The fund mobilization is part of a broader capital strategy aimed at promoting loan growth and regulatory compliance. In its Q4 FY25 earnings call, the bank reported a capital adequacy ratio of 14.3 percent, which exceeded the regulatory threshold. Though it previously stated that it did not require additional capital, the decision now appears to be driven by favorable market conditions and expected credit growth of 12-13%.
