PNB Housing Finance on Tuesday approached Securities and Exchange Board of India (Sebi) for an initial public offer (IPO) worth up to Rs 2,500 crore.

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The leading housing finance firm, promoted by Punjab National Bank (PNB), would be using the proceeds from the share sale mainly towards augmenting its capital base.

According to the Draft Red Herring Prospectus (DRHP), the company plans to raise up to Rs 2,500 crore through the initial share sale and a portion would be reserved for the employees.

The housing finance company plans to utilise the proceeds to augment the company's capital base and for general corporate purposes, as per the DRHP.

"We believe that the listing of our equity shares will enhance our visibility and brand name among existing and potential customers," it added.

For the year ended March 2016, PNB Housing Finance reported a profit after tax of Rs 327.57 crore while revenue from operations stood at Rs 2,699.54 crore in the same period.

At the end of March 2016, PNB had 51% stake in the company. Post IPO, it would "continue to hold approximately 35-37% of the issued and paid-up share capital", according to the DRHP.

Kotak Investment Banking, BofA Merrill Lynch, JM Financial, J P Morgan and Morgan Stanley are the global coordinators and book running lead managers for the proposed issue.

The company plans to grow business and loan portfolio by consolidating position in key geographies as well as by expanding into specific target markets such as the affordable housing segment.