* Bids outnumbered shares on offer by five times
* Issue price set at 550 rupees, top end of the indicative
* Shares rise 4 pct in Mumbai market; up more than 50 pct in
(Adds issue price, banker comment and share reaction)
By Abhishek Vishnoi and Indulal PM
May 30 India's Yes Bank Ltd has raised
$500 million in a share sale to institutional investors, two
bankers involved in the deal said, the first of a raft of equity
deals expected after a landslide election victory for new Prime
Minister Narendra Modi.
The offering, aimed at boosting its balance sheet, drew
strong demand, pricing at the top end of its indicative range
and bids outnumbered shares on offer by five times, the bankers
Prime Minister Modi won India's first outright parliamentary
majority in three decades with a pledge to boost growth and
create jobs, raising hopes among investors for a turnaround led
by spending on infrastructure.
Bankers have said the election win is set to trigger
billions of dollars in share sales by Indian companies, although
big-ticket IPOs may have to wait until Modi proves he can
deliver on promised reforms.
"This is the beginning of a slew of new papers that will
come to the market over the next two to three months," said a
banker who worked on the Yes Bank deal. He declined to
identified as he was not authorised to speak to the media.
"A large number of firms, ranging from financial services to
industrials, need capital to tap the expected pick-up in growth
and they have a nice window of opportunity on the back of the
market euphoria," the banker said.
A sluggish economy and stalled bureaucratic decision-making
for the past two years battered Indian corporate sentiment and
thwarted capital raisings.
The last large IPO was Bharti Infratel's $750
million listing in late 2012. Yes Bank's $500 million share sale
is the largest secondary offering by an Indian company since
State Bank of India Ltd raised $1.3 billion in January.
Yes Bank's shares were priced at about 550 rupees each, the
upper end of the indicative price range of 530 rupees to 550
rupees and a 0.3 percent premium to Thursday's closing price.
A Yes Bank spokesman declined to comment on the share sale.
Shares in Yes Bank were trading 4 percent higher at 570
rupees on Friday, while the main Mumbai market index
was up 0.3 percent. The bank's stock is up more than 50 percent
so far this year with financial sector shares in favour on hopes
that an economic revival will spur a pick up in loan growth.
($1 = 58.8750 Indian Rupees)
(Additional reporting by Himank Sharma and Devidutta Tripathy;
Writing by Sumeet Chatterjee; Editing by Edwina Gibbs)