SBI scales above Rs 2,000 levels on $1 bn fund raising plans

State Bank of India ( SBI) rallied as much as 2.7 per cent to scale above its crucial psychological level of Rs 2000 on Thursday, a day after the country's largest lender, said that it is set to raise $750 million to $1 billion through bond sales.

SBI finally closed 2.1 per cent higher at Rs 2026.85. It hit a low of Rs 1990 and a high of Rs 2038.00 in trade today.

“The lender's will be the second big issue in two days; another state-run firm Oil India raised a billion dollars on Tuesday as international investors believe that the outlook for the economy is set to improve,” said an ET report.

The bonds could be priced somewhere between 240 basis points and 250 basis points above the 10-year US treasuries, said a person familiar with the development requesting anonymity, said the report.

A basis point is 0.01 percentage point.

International investors are lapping up Indian bonds amid expectations that the Bharatiya Janata Party's prime ministerial candidate Narendara Modi with a 'decisive administrator' tag could win the elections.

About $12.2 billion in international debt has been raised by Indian firms in the past year, up from $11.8 billion in the previous 12 months, data from Bloomberg show.