StanChart IDR listing in India a first for foreign banks

Friday, May 14, 2010, 15:19 by Business Editor

The UK-based Standard Chartered, foreseeing a rise in profits in the Indian scene is set to make a mark in India by becoming the first foreign bank to list in the country’s stock exchanges.

The bank had received the regulatory approval to become the first foreign bank to tap the Indian equities market.

The bank had filed a prospectus for the sale of 240 million Indian Depository Receipts and believes that India offers a very good opportunity to become its biggest single market. The sale of StanChart’s Indian shares will start on May 25 and will extend up to May 28.

The bank aims to rise between $500m- $750 million. Indian investors would be allowed to buy its stock on the Bombay and National Stock Exchanges. The bank has also declared that it was interested in exploring the possibility of China listing. Standard Chartered currently garners 90 per cent of its income from Asia, Africa and the Middle East. According to the bank top brass, India is turning out to be an important part of its business, and the listing in India is seen a tactical move that will strengthen Standard Chartered’s market visibility, brand presence and help in the growth of business in the country.

The Mumbai listing shows the Standard Chartered’s desire to boost business in India, which is expected to expand between 7 and 8 per cent during the financial year ending March 2011. The bank plans to sell 240 million shares with every 10 Indian Depository Receipts (IDRs) representing one share of Standard Chartered. The bank has hired UBS AG, Goldman Sachs, JM Financial Consultants, Bank of America-Merrill Lynch, Kotak Mahindra Capital and SBI Capital Markets to manage the offering.

The bank had pocketed 12 percent of its income from India in 2009. Standard Chartered is India’s largest international bank, with 94 branches in 37 cities. The bank has been operating in the country since 1858 with its first branch in Calcutta. It has about two million retail customers and more than 1500 corporate and institutional investors.

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