NEW DELHI (INDIA): Ratings firm Ind-Ra today said PNB Housing Finance Ltd’s “strong linkages” with its parent Punjab National Bank is likely to remain strong even after the reduced shareholding post the initial public offer.
The current rating of PNBHFL (IND AAA/Stable) reflects Ind-Ra’s expectation of continued support from PNB (IND AAA/Stable), India Ratings and Research (Ind-Ra) said.
PNBHFL is planning to raise Rs 3,000 crore through an IPO, the proceeds of which will be used to support its growth plans.
Post the planned issuance, PNB’s stake in the company would settle at around 37-39 per cent from 51 per cent.
Ind-Ra expects the reduced shareholding will not materially alter the strong linkages between PNB and PNBHFL.
PNB housing shares its brand name with the bank and the latter has management control as well. PNB has the authority to appoint the MD for the company and the majority of the executive directors of PNBHFL are deputed from the bank.
These linkages are expected to continue post the IPO. PNB will continue to remain the single largest shareholder over the medium term, said the ratings agency.
Source: Press Trust of India