Canara Bank’s ₹2,000 crore fundraising plan boosts the share price by over 12% in two days

Canara Bank’s ₹2,000 crore fundraising plan boosts the share price by over 12% in two days

• Canara Bank’s continues to surge for a second consecutive day after the public sector entity announced its plans to raise ₹2,000 crore through qualified institutional placement (QIP).
• On December 7, Canara Bank saw its share price rally by 5.62% before markets closed and today it’s up by over 6%.
• The floor price for public sector bank’s QIP has been set at ₹103.50 per share.

Canara Bank’s stock continues to rally for a consecutive day. The share price rose over 6% during early trade on December 8 after the public sector entity announced a fresh round of fundraising to collect ₹2,000 crore.

This comes after Canara's Bank share price already rose 5.62% on December 7 after the bank announced its plan. Canara Bank said it has set a floor price of ₹103.50 per share for its qualified institutional placement (QIP).

That means, over the span of two days, the bank’s stock value has increased by more than 10% overall.

And, since the nationwide lockdown was announced in March — which led to the Indian economy coming to a grinding halt — Canara Bank’s share price has gained 61.7%.

Canara Bank’s ₹2,000 crore QIP
Canara Bank had received shareholders' nod in its annual general meeting, held in August, for raising up to ₹2,000 crore by way of QIP.

A QIP is when a listed company can issue its equity shares to a select group of qualified institutional buyers (QIBs). It undercuts most of the red tape that’s found in other methods of raising funds through equity shares.

"A meeting of the sub-committee of the board-Capital Planning Process of the board of directors of the bank is scheduled to be held on Thursday, December 10, 2020, to consider and determine the issue price for the equity shares as well as the number of shares to be allotted to qualified institutional buyers, pursuant to the QIP," the bank said.