Why Corporates and Investment Banks love ICICI Bank

ICICI Bank’s FPO has met with tremendous success with the issue getting oversubscribed 12.3 times in India and 4 times in the ADR market.

India’s leading businessman, Azim Premji, Mukesh Ambani and Rahul Bajaj have placed bids for Rs.1,000 crore each either directly or through entities owned by them.

Citi, Merrill Lynch P-notes, Temasek and LIC have put in $2billion each and are among the highest bidders. While ICICI Bank’s main competitor and India’s largest bank, SBI has put $1.35 billion worth of bid while PE investor Warburg Pincus has bid close to $1 billion.

Other key investors are Goldman Sachs ($1.5 billion), Deutsche Bank ($1 billion), ABN Amro (over $750 million), BNP Paribas ($440 million), GIC ($350 million) and Government of Singapore Investment Corporation (over $100 million). Interestingly, no US based FIIs invested in the domestic FPO.

From the profile of investors it can be easily inferred that the bank has received a big thumbs up to its strategy. Investors perceive the bank to be a tremendous growth opportunity and on course to become the market leader (presently it is the largest bank in terms of market capitalization).