State Bank of India on Monday announced the allotment of 305.9 million shares to qualified institutional bidders at Rs 817 apiece, making it India’s largest-ever qualified institutional placement (QIP), surpassing Coal India‘s Rs 22,560-crore share sale in 2015.
The QIP price of Rs 817 was at a 0.9% discount to Monday’s close of Rs 824.20 on the BSE. On July 16, SBI had launched the QIP at a floor price of Rs 811.05 per share.
LIC invests
The country’s largest life insurer, Life Insurance Corporation (LIC), gets an allotment of 61.2 million shares, valued at Rs 5,000 crore. As a result, its shareholding in SBI jumps to 9.49% from 9.21%.
Following the success of the QIP, the government’s stake in SBI comes down to 55.03%, from 56.92% as of March 2025. This marks SBI’s first QIP since 2017 when it had raised Rs 15,000 crore.
Strong demand from investors
The QIP highlights the immense appetite for India and high-quality papers. It reportedly received bids worth Rs 1 lakh crore, four times the shares on offer. Global institutions like GIC and Capital International, and domestic institutions like HDFC Mutual Fund, SBI Mutual Fund, Kotak Mutual Fund, and ICICI Mutual Fund showed interest in the institutional placement.
The QIP highlights the immense appetite for India and high-quality papers. It reportedly received bids worth Rs 1 lakh crore, four times the shares on offer. Global institutions like GIC and Capital International, and domestic institutions like HDFC Mutual Fund, SBI Mutual Fund, Kotak Mutual Fund, and ICICI Mutual Fund showed interest in the institutional placement.
Qualified Institutional Placement (QIP) is a way for listed companies in India to raise capital by issuing equity shares, debentures, or any securities convertible into equity shares to a qualified set of institutional investors, without going through the lengthy process of a public offering.
Suppose XYZ Ltd, a listed company, wants to raise Rs 1,000 crore to repay debt. Instead of going for an FPO, it issues new shares to a group of QIBs like SBI Mutual Fund, HDFC Life, and BlackRock through QIP. These investors get the shares at a pre-determined price (as per SEBI rules), and XYZ Ltd gets the capital quickly.