NEW DELHI: The share price of a banking company rose by 4.10 percent following an announcement that it had successfully raised ₹2,000 crores. Bank of India, a public sector bank with over 5,105 branches in India, conducted an issue of Basel III Compliant Tier II Bonds, which received total bids of ₹3,770 crores, oversubscribed by 3.77 times against the base issue size. The bank accepted bids of ₹2,000 crores at a coupon rate of 7.88 percent. Over the past year, the bank’s share price increased by 103.20 percent, offering substantial returns to investors.
Bank of India announced that it had raised ₹2,000 crores through an issue of Basel III Compliant Tier II Bonds, with total bids amounting to ₹3,770 crores. This indicates strong investor interest and oversubscription of 3.77 times against the base issue size.
In response to the fundraising news, the bank’s share price increased by 4.10 percent, reaching an intraday high of ₹107.80 apiece on the National Stock Exchange (NSE).
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Bank of India is categorised as a mid-cap company with a market capitalization of ₹42,524 crores.The bank has a low return on equity of 1.17 percent and a dividend yield of 1.93 percent. Its price-to-earnings ratio (P/E) stands at 8.97, which is lower than the industry average P/E of 14.42, suggesting that the stock may be undervalued compared to its peers.The company’s promoters hold an 81.41 percent stake in the company, followed by domestic institutions with 8.52 percent, retail investors with 6.45 percent, foreign institutions with 2.25 percent, and mutual funds with 1.37 percent.
Over the past year, Bank of India’s share price has surged from ₹53.05 to ₹107.80 apiece, delivering a multibagger return of 103.20 percent. An investment of ₹1 lakh in the company’s shares a year ago would be worth ₹2.03 lakhs today.
Bank of India’s successful fundraising of ₹2,000 crores through Basel III Compliant Tier II Bonds, coupled with strong investor interest, led to a notable increase in its share price. The bank’s financial metrics, including a low P/E ratio compared to industry peers, suggest potential undervaluation. Investors have witnessed significant returns over the past year, making Bank of India a notable player in the banking sector.
