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PNB Housing Finance NSE -1.52 % on Wednesday said it will raise up to Rs 1,800 crore equity capital through a preferential or rights issue.

The decision was taken at its board meeting on Wednesday, PNB Housing Finance said in a regulatory filing.

"The board of directors of PNB Housing Finance at its meeting held today i.e., August 19, 2020 has approved to raise equity capital aggregating up to Rs 1,800 crore through preferential issue/rights issue," it said.

The fund raise is subject to shareholders' approval and other regulatory clearances.

Preference shares are those wherein the holders of the stock are paid fixed dividends as well as given preference for being paid from the company's assets before common stockholders in case it goes bankrupt.

Rights issue refers to offering additional shares to existing shareholders proportionate to their existing holding.

PNB Housing Finance is promoted by Punjab National Bank NSE 0.56 % with a shareholding of 32.65 per cent as on June 30, 2020, while Carlyle group's Quality Investment Holdings holds 32.22 per cent stake.

Stock of PNB Housing Finance closed at Rs 275.45 apiece on BSE, up 5.58 per cent from its previous close.