Investors lap up SBI bond by 4.5 times

Mumbai, Mar 2: Similar to all the other government bonds that were lapped up by investors with great gusto, the State Bank of India bond had a similar welcome. Retail investors have lapped up the Rs 1,000-crore State Bank of India bond issue 4.5 times taking the overall subscription to a full 8.5 times.

Sources at Kotak Mahindra Bank, one of the merchant bankers to the issue, told PTI that the bank has received subscriptions for Rs 8,580 crore or more than 8.5 times the minimum on offer. The issue, which opened for subscription on Feb 21 closed yesterday.

"Retail investors have put in bids for Rs 4,500 crore, against the minimum Rs 500 crore on the offer, while the qualified institutional investors have bid for Rs 3,500 crore compared to the minimum offer of Rs 250 crore, and those from the high networth individual touched a little over Rs 500 crore, which is double the offer," said the sources who could not be identified.

"These are provisional figures as there are some more applications from the remote areas to be accounted for," the source added.

This issue is part of the Rs 10,000-crore retail bond programme SBI has planned for FY11 through FY12. Already the bank had raised Rs 1,000 crore in the first tranche of the issue last Oct, which was oversubscribed 19 times. That was the first retail bond offering in the country by a corporate entity.

PTI