State Bank of India is preparing for its biggest $3 billion stock offering in seven years.

The State Bank of India (SBI) has selected six investment banks for a $3 billion equity offering. The consultants included the Indian divisions of Citigroup Inc. and HSBC Holdings Plc, as well as ICICI Securities, Kotak Capital, Morgan Stanley and SBI Capital. This was reported by sources familiar with the situation.

Formal agreements with investment consultants are expected in the near future. The placement is scheduled for the end of July. Representatives of HSBC declined to comment, while representatives of SBI and other banks did not respond to media inquiries at the time of publication.

According to the information, the placement of shares was approved by the bank's board of Directors last month. This is the first such large-scale capital raising since 2017. The decision to enter the market is due to favorable market conditions — stock prices of Indian banks are close to record levels, which allows the placement to be carried out at high valuations.

Since the beginning of the year, India's four state-owned banks have raised a combined total of about $720 million through private placements with Qualified Institutional Placement (QIP) investors. Similar plans are being considered by private banks, including Axis Bank Ltd. and IDFC First Bank Ltd.

The previous major placement of SBI shares took place in the 2017-2018 financial year, when the bank raised 150 billion Indian rupees (about $1.8 billion) through QIP. The new stage of raising capital will be the largest in the last seven years and can significantly strengthen the bank's position in the domestic and international markets.