The board of directors of Reliance Infrastructure on Thursday approved a proposal to raise R2,000 crore through a qualified institutional placement (QIP). The company will now seek the approval of shareholders for the QIP through a postal ballot.
In an exchange filing, the company said the amount raised through QIP will be used for debt reduction and to utilise business oppurtunities in the defence sector.
Last week Hindalco completed a QIP worth R3,000 crore. QIP is a capital-raising tool through which listed companies can issue equity shares, fully and partly convertible debentures, or any securities other than warrants that are convertible into equity shares to a qualified institutional buyer.
In 2016, companies raised R4,712 crore through the QIP route, the lowest since 2012. In CY 2015 companies raised R24,064 crore, and in 2014, R31,684 was raised, data from PrimeDatabase revealed.