Bajaj Finance’s board on October 1 approved a Rs 17,500 crore fundraising plan through a qualified institutional placement and warrants. The QIP will raise up to Rs 11,700 crore, while Rs 5,800 crore will come through warrants issued to promoter Bajaj Finserv.

The company will seek shareholder approval through an extraordinary general meeting. Shares of Bajaj Finance rose about 3 per cent to Rs 974.60 after the announcement.

The fundraising will strengthen the lender’s capital base as it continues to grow its loan book. Bajaj Finance reported assets under management of Rs 5,84,750 crore in the June quarter, up 26.5 per cent year on year, with a customer base of 128.85 million.

The issue is among the largest by an Indian non-banking finance company. Analysts say the capital raise positions the company to capture credit demand while maintaining its capital adequacy ratios.

Market watchers said the timing takes advantage of strong investor appetite for financial stocks. The company’s asset quality has stayed stable even as its loan book expanded rapidly across consumer and small-business segments.