July 1, 2025: Federal Bank shares are expected to be in focus this Tuesday after the private lender announced a major fundraising initiative. The bank’s board has approved raising up to ₹6,000 crore through a mix of equity and debt instruments, pending shareholder and regulatory approvals.
On the equity front, the bank may explore multiple channels including rights issue, preferential issue, further public offer (FPO), qualified institutional placement (QIP), global depository receipts (GDR), American depository receipts (ADR), and foreign currency convertible bonds (FCCBs).
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In addition, the board has greenlit raising capital via debt instruments such as Additional Tier I (AT1) and Tier II bonds, long-term infrastructure and affordable housing bonds, masala bonds, green bonds, and non-convertible debentures (NCDs). These will likely be issued through private placement in domestic and international markets, within the bank’s borrowing limits.
This strategic move comes on the heels of a strong quarterly performance. For the quarter ended March 31, 2025, Federal Bank reported a 13.7% year-on-year rise in net profit to ₹1,030.2 crore, surpassing CNBC-TV18’s estimate of ₹977.5 crore. In the same quarter last year, the bank had posted a net profit of ₹906.3 crore.