The board of PNB Housing Finance on Tuesday approved raising up to `1,700 crore through the qualified institutional placement (QIP) route and discussed a preferential allotment to an investment vehicle of the Carlyle Group, Quality Investment Holdings (QIH), the company informed the stock exchanges.
“The board also considered it advisable, subsequent to the successful closure of the QIP, to offer Quality Investment Holdings (QIH) and/or its affiliates/nominees a preferential allotment of equity shares and/or permissible securities,” the release said.
The preferential allotment to QIH is subject to conditions, including the terms of the preferential issue being no less favourable than those offered to QIP investors. The company also clarified that QIH is not obligated to subscribe to the preferential issue at this stage. “Should it choose to participate, QIH can subscribe to at least such number of agreed securities in the preferential issue as required to maintain its pre-QIP shareholding in the company,” PNB Housing Finance said.
Earlier, on February 21, ratings agency Crisil downgraded PNB Housing Finance’s non-convertible debentures (NCDs) worth `5,700 crore and bank loan facilities worth `4,000 crore to “CRISIL AA/Stable” from “AA+/negative”. The ratings agency had also downgraded the `20,000-crore fixed deposit programme of the housing financier to FAA+/stable from FAAA/negative.
Punjab National Bank (PNB) held 32.65% stake in the company while QIH had a shareholding of 32.22% as on December 31, 2019. PNB Housing Finance’s consolidated net profit dropped 21.8% year-on-year (y-o-y) to `237 crore.
Interestingly, Crisil also noted that PNB Housing’s fund raising ability had remained intact over the last six-nine months and it continues to maintain high on-balance liquidity.
Earlier, the mortgage lender’s parent PNB has specified that it intends to hold a minimum of 26% stake in the company. PNB Housing Finance’s shares ended at `341.70 on Tuesday on the BSE, up 1.02% from the previous day’s close.