Suryoday Small Finance Bank IPO ends with decent subscription
Published on Mar 22, 2021 10:50
The initial public offer (IPO) of Suryoday Small Finance Bank received bids for 3.20 crore shares as against 1.35 crore shares on offer, according to the stock exchange data. The issue was subscribed 2.37 times.
The retail individual investors category was subscribed 3.09 times. The qualified institutional buyers (QIBs) category was subscribed 2.18 times. The non-institutional investors category was subscribed 1.31 times.
The issue opened for bidding on Wednesday, 17 March 2021, and it closed on Friday, 19 March 2021. The price band for the IPO was set at Rs 303-305 per share.
The issue comprised of 1.90 crore equity shares comprising a fresh issue of up to 81.50 lakh equity shares and an offer for sale of up to 1.09 crore equity shares.
Ahead of the IPO, the bank finalized allocation of 55.77 lakh shares to anchor investors at a price of Rs 305 per share, aggregating to Rs 170.12 crore.
The bank proposes to utilize the net proceeds from the offer towards augmenting bank`s tier I capital base to meet future capital requirements. The listing of the bank is also in line with terms of the RBI in-principle approval, RBI final approval and SFB licensing guidelines, requiring the bank to list its equity shares on the stock exchanges within three years from the date of commencement of business.
The small finance bank (SFB) reported a net profit of Rs 54.87 crore and a net total income of Rs 418.20 crore in the nine months ended on 31 December 2020.
Suryoday Small Finance Bank is among the leading Small Finance Bank (SFBs) in India in terms of net interest margins, return on assets, yields and deposit growth and had the lowest cost-to-income ratio among SFBs in India in FY2020. It has been serving customers in the unbanked and underbanked segments in India and promoting financial inclusion for over a decade, operating as a Non-Banking Finance Company prior to converting to SFB. The company started operations as an SFB on 23 January 2017 and it was included in the second schedule to the RBI Act on 24 July 2017. Over the years, the bank has diversified its loan portfolio to include non-micro banking loans thereby reducing dependence on micro banking business.
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