Tag: pnb housing finance

PNB Housing Finance plans fund raising up to ₹2,000 crore via NCDs

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PNB Housing Finance Limited (PNBHFL) proposes to go in for a fund raise of up to ₹2,000 crore through non convertible debentures (NCD) route. This proposal will be taken up at the upcoming board meeting of PNBHFL on November 2, sources said.

This plan to go in for fund raising via NCD route — in tranches — on private placement basis comes on the heels of the PNBHFL Board deciding not to proceed with the ₹4,000 crore preferential allotment deal with Carlyle Group and other marquee investors.

Preferential allotment deal falls through

It may be recalled that the PNBHFL-Carlyle Group deal had hit a roadblock after a proxy advisory firm had red flagged the preferential allotment on the pricing front, contending that it was not in the interest of the promoter (PNB) as well as the minority shareholders of PNBHFL.

Market regulator SEBI had soon after this intervened and asked PNBHFL not to go ahead with the planned preferential issue until the valuation of the shares is done by an independent registered valuer.

Also see: PNB Housing locked in lower circuit after it shelves stake sale plan

PNBHFL had fixed the preferential allotment price at ₹390 per share, lower than the stock price prevailing at that time. The company had preferred an appeal before the securities appellate tribunal (SAT) on the SEBI letter.

A two-member bench of the SAT on August 9 gave a split verdict and directed that its interim order of June 21 will continue till further orders. SAT also restrained PNB Housing Finance from disclosing the voting results (of shareholders) on the fund raise plan.

Post the SAT’s split verdict, SEBI had filed an appeal at the Supreme Court against this verdict.

SC dismisses SEBI appeal

Meanwhile, the Supreme Court on Wednesday dismissed the SEBI appeal against the SAT’s order in the PNBHFL’s ₹4,000 crore capital raising deal with Carlyle Group and other investors, stating that the appeal has become infructuous due to subsequent developments.

A bench headed by Justice L Nageswara Rao was informed by the counsel for PNBHFL that the housing finance company had decided not to proceed with the preferential allotment of shares and warrants to Carlyle Group and that an application has also been moved before SAT for withdrawal of its appeal against a SEBI directive.

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Sebi moves SC, BFSI News, ET BFSI

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MUMBAI: PNB Housing has informed the stock exchanges that markets regulator Sebi has approached the Supreme Court against a split order by the Securities Appellate Tribunal (SAT).

Sebi is pushing the housing finance firm to relook at a deal to sell a Rs 4,000-crore stake to private equity investors led by Carlyle on the grounds that valuation norms have not been followed.

“It has been brought to our notice that Sebi has filed an appeal (no. CA5052 of 2021) to the Supreme Court of India against the order of SAT. The company is examining the appeal filed by Sebi,” PNB Housing Finance said in a notice to the stock exchanges.

On August 9, SAT delivered a split verdict over PNB Housing’s share allocation to Carlyle Group. This followed an interim order where SAT had restricted PNB Housing from disclosing the results of shareholder votes on the deal.

Sebi had asked the housing finance companies to call off the voting. However, following an appeal by the company, SAT allowed the general body to vote on the proposal.

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PNB Housing Finance plans to raise Rs 35,000 crore debt as Carlyle deal in abeyance, BFSI News, ET BFSI

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PNB Housing Finance is now looking to raise Rs 35,000 crore debt, after facing legal hurdles in the Carlyle group deal, days after SAT gave a split verdict in the matter.

The company will seek shareholders’ nod in its annual general meeting (AGM) on September 3, 2021, PNB Housing Finance said in a regulatory filing.

The company said it will seek shareholders’ approval for further fund raising by way of debt issue.

“Shareholders’ approval is being sought in the 33rd AGM for further fund raising by way of debt issue and the shareholders are being requested to authorise the board of directors to offer, from time to time, the subscription of redeemable, secured/unsecured non-convertible debentures aggregating to Rs 35,000 crore in one or more tranches,” it said in the filing.

On Monday, Securities Appellate Tribunal (SAT) gave a split verdict in the company’s appeal to the court in the matter related to Rs 4,000 crore equity fund infusion led by its existing investor Carlyle group, and others through preferential allotment of shares and warrants.

Had the deal not stuck into regulatory and legal hurdles, the company would have been successful in raising the equity capital.

The Carlyle deal

The Carlyle-led deal was announced on May 31, in which a clutch of investors including former HDFC Bank MD&CEO Aditya Puri‘s family investment vehicle Salisbury Investments, were to infuse equity capital in PNB Housing. Puri is also a senior advisor for Carlyle in Asia.

However, the deal soon got into a controversy after a proxy advisory firm raised issues and said it would hurt the interest of the minority shareholders as well the promoter. It said the issue price of Rs 390 apiece was too low vis-a-vis the prevailing stock price.

Subsequently, Sebi asked the company to get the valuation of the issue price done from an independent registered valuer, while the company approached the SAT in June, citing it followed the Sebi guidelines on deciding on the price.

The SAT order

SAT in its order, by the two-member bench of Justice Tarun Agarwala and Justice M T Joshi said:”In view of the difference of opinion between the members of the bench “we direct the interim order dated 21st June, 2021 to continue till further order.” Prevalence of interim order means the company can’t disclose the results of the shareholders’ voting that happened on June 22, to know if they cleared the proposal with requisite majority or not.

The company has been looking to raise funds for the past few years. Also, the Reserve Bank of India earlier this year had barred PNB from infusing capital into its subsidiary.

The Carlyle matter is likely to reach the Supreme Court since the tribunal did not provide a clear verdict on the way forward for the deal.



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PNB Housing Finance Q1 net zooms 91% sequentially to ₹243 crore

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PNB Housing Finance Ltd (PNBHFL) on Wednesday reported a consolidated net profit of ₹243 crore for the first quarter ended June 30, 2021. This was a 91.34 per cent increase over net profit of ₹127 crore in the previous March 2021 quarter.

However, on a year-on-year basis, bottomline fell marginally in first quarter this fiscal when compared to net profit of ₹257 crore recorded in same quarter last fiscal.

Total income down

Total income for the quarter under review decreased to ₹1,693 crore from ₹1,834 crore in the March quarter. In June quarter last fiscal, total income stood at ₹1,872 crore.

Also read: CCI green signals Carlyle Group-led ₹4,000 cr investment in PNB Housing

Commenting on the Q1 financial performance, Hardayal Prasad, Managing Director & CEO, said in a statement, “The second wave of Covid-19 impacted the business performance of the company as compared to last quarter. Despite this, the company recorded healthy profits and margins during the quarter. The company continues to focus on increasing its digital footprints, grow retail business with efficient underwriting and collection models and optimise costs in order to create value for all its stakeholders.”

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PNB Housing Finance: ‘Stake sale singled out’

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PNB Housing Finance on Monday told the Securities Appellate Tribunal that the ₹4,000-crore stake sale to a clutch of investors, led by private equity firm Carlyle Group, was being singled out by SEBI when similar fund-raising by other entities have gone through without any objections.

Senior advocate Janak Dwarkadas, arguing the case on behalf of PNB Housing, said that SEBI did not have jurisdiction on the issue.

In June, the Securities and Exchange Board of India had asked PNB Housing Finance not to go ahead with the stake sale, until the housing finance company undertakes an independent valuation of its shares. The market regulator said the notice given by PNBHF on May 31 for an Extraordinary General Meeting to approve the stake sale is “ultra-vires of Article of Association (AoA) and shall not be acted upon until the company undertakes the valuation of shares.”

PNB Housing challenged the SEBI order after which SAT had allowed PNB Housing to go through with the EGM but asked it to not disclose the voting results until further orders.

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SAT hearing on PNB Housing-Carlyle deal put off a week

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The Securities Appellate Tribunal (SAT) will hear the case related to the PNB Housing Finance-Carlyle deal next Monday.

The order in the matter was expected on July 5, however, it was adjourned for July 12.

PNB Housing had filed an appeal before the SAT against the letter issued by the Securities and Exchange Board of India last month, requesting it not to go ahead with the proposal until due diligence was done.

“As sought by the company, the Securities Appellate Tribunal, in its hearing on July 5, 2021, adjourned the case for Monday, July 12, 2021,” PNB Housing Finance said in a regulatory filing on Tuesday.

Capital infusion by Carlyle

Under the deal announced on May 31, the US-based Carlyle, alongside other investors, is slated to infuse ₹4,000 crore capital into PNB Housing through the issuance of preference shares and warrants.

However, the deal has come under the scanner of the regulator. The company was directed to carry out the valuation process of shares as per the relevant legal provisions.

PNB Housing contended that it has followed SEBI norms in deciding the issue price at ₹390 apiece.

The scrip of the company traded at ₹695.35 apiece on BSE, down 1 per cent from its last close.

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PNB not to take part in housing finance arm’s planned fund raise, BFSI News, ET BFSI

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Mumbai, Punjab National Bank will not take part in the capital raising plans of PNB Housing Finance.

Last August, the Board of PNB Housing Finance approved raising Rs 1,800 crore of equity capital through preferential issue or rights issue.

Referring to the decision, PNB Housing, in a regulatory filing, said that it will continue to pursue with the proposed capital raising plan.

“Punjab National Bank has communicated that it shall not be participating in the capital raise plans of the company. However, the company will continue to pursue with the proposed capital raising plan through permitted modes,” the filing said.

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RBI seeks details of Punjab National Bank’s capital raising plans, BFSI News, ET BFSI

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The Reserve Bank of India wanted to know about Punjab National Bank’s (PNB) future capital projection as the regulator examines the lender’s proposal to infuse Rs 600 crore in PNB Housing Finance.

PNB, the promoter of the mortgage lender, had sought the regulator’s approval about seven months’ back. RBI’s decision is still awaited, delaying PNB Housing Finance’s capital raising plan.

PNB’s chief executive SS Mallikarjuna Rao is expecting a positive note from RBI soon. “It’s not that the issue is stalled or there is no communication. The regulator was seeking details on the bank’s capital position and capital raising plans,” he said.

PNB, with a 32.65% ownership, proposed to infuse equity capital in PNB Housing through rights or preferential issue of shares. The bank augmented its capital by Rs 3,788 crore in December in qualified institutional placement even as it was looking to raise Rs 7,000 crore.

On August 19, 2020, the PNB Housing Finance board had approved Rs 1,800 crore capital raising through rights and preferential issue of shares. “Before that the PNB had approached the Reserve Bank of India for permission to infuse equity into the company. Since they had actually asked that the equity infusion can take place either through rights issue or preferential, we were awaiting permission from the Reserve Bank of India,” PNB Housing Finance chief executive Hardayal Prasad told analysts after the company’s third quarter results.

With the delay in getting the regulator’s nod, PNB Housing board last month approved share sales to other institutional investors as the lender needs capital for its medium-term growth plans.

“We are hopeful that PNB would be able to get its approval. Once that approval comes, we still can issue the rights or the preferential,” Prasad said.

Meanwhile, PNB is planning to go to investors again to raise Rs 3,200 crore from share sales. It would also look to issue additional tier-1 bonds (AT-1 bonds) worth Rs 2500 crore before March 31.

The lender has garnered Rs 4,000 crore in tier-II bonds and Rs 495 crore in AT-1 bonds in the last few months.



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PNB Housing Finance Q3 net profit dips to ₹232 crore

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PNB Housing Finance Limited (PNBHFL) reported a net profit of ₹232 crore for the third quarter ended December 31, 2020.

This was marginally lower to the net profit of ₹237 crore recorded in the same quarter last fiscal. The latest bottom line was also lower than the net profit of ₹313 crore recorded in the second quarter ended September 30, 2020.

Total income for the quarter under review declined to ₹1896 crore, down 9 per cent over total revenue of ₹2075 crore in the same quarter last fiscal. In the previous September quarter, this home loan lender had recorded total revenue of ₹2022 crore.

For the nine months ended December 31, PNBHFL reported a 10 per cent decline in net profit at ₹803 crore (₹888 crore). Total Revenue declined 11 per cent to ₹5,790 crore (₹6,538 crore )

Commenting on the financial performance, Hardayal Prasad, Managing Director & CEO, PNBHFL said in a statement ”Post RBI moratorium, the Company witnessed an impact on collection efficiency. However, the situation is improving and with various measures under taken, we expect to reach pre-Covid efficiency levels in near term. The Company has set out its new agenda with focus upon Strengthening the core, Driving efficiency and Accelerating Growth. These are built upon 7 core pillars viz Management, Capital Position, Risk Management, Cost Management, Digital Drive, Retail Focused Lending and Grow Affordable Housing”.

PNBHFL’s Net Interest Margin increased 20 basis points to 3.2 per cent in the third quarter this fiscal from a level of 3 per cent in the same quarter last fiscal.

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PNB Housing Finance launches free essential healthcare in Delhi NCR, BFSI News, ET BFSI

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Due to the pandemic, people living in and around high containment zones and rural areas are unable to visit their local clinics for checkup and treatment. PNB Housing Finance today donated a mobile medical unit (MMU) to Adharshila, an NGO based in New Delhi, In its sustained efforts to provide quality healthcare to the economically and socially deprived sections of society.

The MMU will visit construction sites, labour colonies and urban slums to provide health checkups and referrals, thereby ensuring the welfare of construction workers and their families in Delhi and NCR.

The MMUs are equipped with doctors and support staff as well as medicines, dressing and surgical tools, hand sanitizers, PPE kits, stethoscopes, blood pressure cuffs or BPMs, cloth masks, oximeters and glucometers. Both the treatment and medicines will be provided free of cost to the underprivileged.

PNB Housing Finance Managing Director and CEO Hardayal Prasad said, “PNB Housing Finance strives to transform deserving communities through various social development programmes round the year. Our mobile medical unit initiative aims to make specialised healthcare easily accessible to people from the economically marginalised sections of society. We believe that sound health is critical for social and economic wellbeing. This collaboration will help us take essential healthcare to the doorsteps of those who need it the most.”

The fully-equipped mobile medical van will visit each area fortnightly and address various medical conditions such as malnutrition, anemia, gastrointestinal, respiratory tract infections, osteoporosis, gynecological, endocrinological and other health issues for all age groups.



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