Top Stories

HDFC board clears raising Rs 57,000 crore through non-convertible debentures

Mar 28, 2023

By: BlinkX Research Team

Mortgage lender HDFC Ltd. announced on Monday that its board has approved raising money through NCDs in tranches totaling Rs 57,000 crore. 
In a regulatory statement, HDFC stated that the board has approved the issuing of unsecured, redeemable, non-convertible debentures under a shelf placement memorandum totaling Rs 57,000 crore in various tranches. 
According to the statement, this is in conformity with the approval given by HDFC shareholders at the 45th annual general meeting held on June 30, 2022.

In addition, it noted that "the board has approved increasing the corporation's overall borrowing capacities from Rs 6 lakh crore to Rs 6.50 lakh crore, outstanding at any point in time and recommended the same for approval of the corporation's members by way of postal ballot." 
The decision was made because HDFC still needs to borrow money for commercial purposes up until the merger's effective date, and its total outstanding debt is currently estimated to be over Rs 5.70 lakh crore.

By the third quarter of the upcoming fiscal year, parent company HDFC Ltd is anticipated to merge with subsidiary HDFC Bank. 
In what has been called the largest corporate merger in Indian history, HDFC Bank agreed to acquire the largest local mortgage lender in April 2022 in a deal estimated to be worth approximately USD 40 billion, forming a financial services behemoth. 
The aggregate asset base of the proposed business will be close to Rs 18 lakh crore. Depending on regulatory permissions, the merger is anticipated to be finished by the second or third quarter of FY24.