DCB to raise Rs 186 cr through IPO; to invest in SMEs

New Delhi, Sep 26 (UNI) Mumbai-based Development Credit Bank (DCB) will raise Rs 186 crore through its Initial Public Offer (IPO) of 71,500,000 equity shares of Rs 10 each, for investment in small and medium enterprises (SMEs), corporate banking and retail sectors.

''DCB will invest most of the raised fund into SMEs, corporate banking, and retail sector,'' DCB Executive Vice President (Treasury and Financial Institutions Group) K Harihar told reporters here.

The bank has no plans to invest in large corporations as SMEs have a huge potential for doing business, he added.

The raised funds will also be used to strengthen the bank's capital adequacy ratio to 19.5 per cent from the current 9 per cent.

The bank will issue 71,500,000 equity shares at a price band of Rs 22-26 per share.

The price is to be determined through a 100 per cent book building process. The offer will open for subscription on September 29 and close on October 6.

Out of the total number of shares on offer, 2,502,500 equity shares are reserved for eligible employess and rest will be available for public subscription.

The IPO by the company is going to reduce the holding of Switzerland-based Aga Khan Fund for Economic Development (AKFED) to 30.13 per cent. AKFED currently holds 58.43 per cent stakes in DCB.

DCB has 72 branches, mostly in the western part of the country, of which 67 are full-fledged and 5 are the extension counters.

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