Source:Busibess Line :PTI:19-10-2010:NEW DELHI:
State Bank of India’s first retail bond issue of Rs 1,000 crore was subscribed over 17 times on the opening day, showing enthused participation from investors. The issue, which opened for subscription on Monday, will close on October 25.
Market sources said that the portion reserved for wealthy individuals (High Networth Individuals) was subscribed by over 16 times, while that reserved for retail investors was oversubcribed 6.4 times.
The offering comprises issue of bonds worth Rs 500 crore, with an option to raise it further up to Rs 500 crore by issuing additional bonds. The bonds would offer an interest of 9.25 per cent for 10 years and 9.5 per cent for 15 years.
Citigroup, Kotak Mahindra Capital and SBI Capital Markets are the managers for the issue. The bonds are proposed to be listed on the National Stock Exchange.
The application size for retail investors is Rs 5 lakh, HNIs Rs 250 crore and for qualified institutional buyers Rs 250 crore.
According to the market sources, electronic subscriptions were not available for retail investors.
The Securities and Exchange Board of India has barred electronic subscription for retail investors to avoid confusion at the time of allotment. The bonds would be allotted to all categories on “first come first serve basis” based on the date of applicati on.
Meanwhile, the SBI scrip was trading 0.13 per cent higher at Rs 3,171.25 in the morning trade on the BSE.
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