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HDFC Bank lists ADS at discount

Our Bureau

MUMBAI, July 20

HDFC Bank has priced its initial public offering of 1.08 crore American depository shares (ADS) at $13.83 per ADS on the New York Stock Exchange. The total offering was of $150 million and has been listed under the symbol `HDB'.

The ADS opened on the NYSE at $14.50 and was trading at $14.60 at around 8 p.m. The volumes were around 1.1 million ADS. The issue was oversubscribed 7.6 times and 75 per cent of the total demand was reportedly from institutions.

Each ADS is equivalent to three underlying equity shares of HDFC Bank and the ADS has been listed at a discount. Mr Aditya Puri, Managing Director, HDFC Bank, said, ``it was a conscious decision to price the shares at a discount.'' The offering was price d at the average trading price of the HDFC Bank share on the BSE for the last 10 days.

The HDFC share today closed at Rs 225 on the Bombay Stock Exchange.

The bank has a greenshoe option of retaining 15 per cent of the oversubscription. If the option is exercised, HDFC's holding in the bank would come down to 25 per cent. Pre-issue, the HDFC group's holding stood at 28.3 per cent. The other major holdings were Chase group at 13.35 per cent and Bennet, Coleman and Co at 8.4 per cent.

HDFC Bank's capital adequacy currently stands at 10.11 per cent which would improve to 16 per cent after the issue. Tier-I capital will constitute 13 per cent of the total.

Merrill Lynch and Morgan Stanley were the global co-ordinators and book runners to the issue. Cazenove, CLSA Emerging Markets and Dresdner Kleinwort Wasserstein also assisted them in the offering. The underwriters have the option to purchase an additiona l 1,626,898 ADS to cover over-allotments over the next 30 days.

The money raised from the issue will be used for funding future growth, capital base and other general corporate purpose, according to Mr Puri.