New Delhi: Bank of India (BoI) announced that it has successfully raised ₹10,000 crore through the issue of Long Term Infrastructure Bonds at an attractive coupon rate of 7.23% per annum. The issue was conducted through the NSE Electronic Bidding Provider Platform, with a base issue size of ₹5,000 crore and a Green Shoe option of ₹5,000 crore.
The bank received a total of 83 bids amounting to ₹15,305 crore, indicating strong market demand. Out of these, 37 bids totaling ₹10,000 crore were accepted. Bank of India stated that the funds raised through this issue would be used to finance long-term projects in infrastructure sub-sectors and affordable housing in accordance with RBI guidelines, and the funds are not earmarked for any specific project.
Green Shoe Option Boosts Fundraising
In response to overwhelming demand, the bank exercised the Green Shoe option, effectively doubling the issue size from the base ₹5,000 crore to ₹10,000 crore. The long-term bonds attracted attention from institutional investors, with 11 major institutional investors allotted the bonds.
The coupon rate of 7.23% per annum was considered attractive for long-term investors, reflecting the bank’s strong positioning in the market and its ability to mobilize long-term funding at competitive rates.
Read also: Bank of India to Redeem 9.04% AT1 Bonds Series VI; Record Date Set for 13th January 2026
Market Response and Investor Sentiment
The success of this capital raise had a positive impact on Bank of India’s stock (BANKINDIA). As of December 26, shares of Bank of India were trading at around ₹139.60, despite mild profit booking observed across the Nifty Bank index. The threefold oversubscription of the bond issue strengthened investor confidence in the bank.
From a valuation perspective, Bank of India remains attractive, with a P/E ratio of 6.6 and a P/B ratio of 0.86, making it a potential value buy in the banking sector. Analysts largely maintain a BUY rating, with the average target price around ₹141.50.
The funds raised through these long-term infrastructure bonds are expected to enhance the bank’s Net Interest Margin (NIM) by providing low-cost, long-term capital. This, in turn, could serve as a positive trigger for the share price in the near future.
About Bank of India
Bank of India is a public sector bank headquartered in Mumbai, with a strong presence across India and overseas. Established in 1906, the bank provides a wide range of banking services, including corporate, retail, and international banking. BoI has a reputation for infrastructure financing and long-term lending, making it a significant player in India’s banking and financial sector.
