Dhanlaxmi Bank to Raise ₹150 Crore via Tier-II Bonds

Private sector lender Dhanlaxmi Bank Ltd on Wednesday (March 19, 2025) announced that its Board of Directors has approved the issuance of unsecured, non-convertible debentures (NCDs) in the form of Basel III-compliant Tier-II bonds to raise up to ₹150 crore.

Fundraising Details 

In a regulatory filing, the bank stated, “The Board of Directors at its meeting held on March 19, 2025, considered and approved the proposal for the issue of unsecured non-convertible debentures in the form of Basel III-compliant Tier-II Bonds of ₹1,00,00,000 (one crore) each, up to a maximum of ₹150 crores, with a tenure of 10 years on a private placement basis.”

The bonds, with a face value of ₹1 crore each, will be privately placed and have a tenure of 10 years. Additionally, the Board has approved the general information document, key information document, and term sheet for the proposed issue.

Q3 FY25 Performance 

Dhanlaxmi Bank reported an impressive 563.33% year-on-year (YoY) jump in net profit, reaching ₹19.9 crore for the third quarter (Q3) ending December 31, 2024. This marks a sharp rise from the ₹3 crore net profit recorded in the same quarter of the previous fiscal (Q3FY24).

The bank’s Net Interest Income (NII) also showed robust growth of 12.5%, rising to ₹128.3 crore from ₹114 crore in Q3FY24.

On the asset quality front, Gross Non-Performing Assets (GNPA) improved to 3.53% in Q3FY25, down from 3.82% in Q2FY25. Net NPA (NNPA) also declined to 0.86% from 1.12% quarter-on-quarter, indicating better asset quality management.

Stock Performance 

On March 20, 2025, Dhanlaxmi Bank share price traded 2.22% higher at ₹24.40 at 9:23 AM (IST). Dhanlaxmi Bank’s share price reached a 52-week high of ₹40.44, and a 52-week low of ₹22.01. As per BSE, the total traded volume for the stock stood at 0.12 lakh shares with a turnover of ₹2.80 lakhs.

At the current price, Dhanlaxmi Bank shares are trading at a price-to-earnings (P/E) ratio of 14.74x, based on its trailing 12-month earnings per share (EPS) of ₹1.62, and a price-to-book (P/B) ratio of 0.57, according to exchange data.

Conclusion

With a strong financial performance in Q3 and a strategic move to raise Tier-II capital, Dhanlaxmi Bank is aiming to strengthen its balance sheet and improve capital adequacy.

The ₹150 crore bond issuance aligns with Basel III norms, ensuring long-term financial stability. As the bank continues its growth trajectory, investor sentiment is likely to remain positive.

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