PNB Home Fin mandates 3 banks for $300 million IPO

MUMBAI: PNB Home Finance has mandated three investment banks -Morgan Stanley , JP Morgan and Bank of America Merrill Lynch -to prepare for a $300-million initial public offering ( IPO) later this fiscal, sources familiar with the matter said.

Punjab National Bank (PNB), which owns 51% in the unit, is likely to pare its shareholding, while giving global private equity investor Carlyle liquidity on its 18-month-old investment. Caryle had picked up a 49% stake in the home finance company -which provides loans to purchase and construct residential premises -in early 2015.

Last month, PNB's MD Usha Ananthasubramanian said that the bank was looking at monetizing its 51% stake by listing the housing finance company , wit hout divulging details. Carlyle declined to comment.

India's public sector banks are looking to monetize non-core assets as they battle a mountain of bad loans sitting on their books. The RBI has been pushing lenders to conduct all lending activity within the bank's balance sheet and has asked them to either hive off or merge their NBFC arms.

The listing of PNB Home Finance could be one of the biggest IPOs to hit Indian bourses after InterGlobe Aviation (IndiGo) raised around $500 million in December last year. The new public market listings have shown some buoyancy after 21 companies raised a cumulative $2 billion last year. PNB Home Finance has a net worth of Rs 2,145 crore. In FY16, the company's net profit after tax stood at Rs 192 crore -up 77% from Rs 108 crore in the previous year.