Utkarsh Small Finance Bank files for IPO
Utkarsh Small Finance Bank files for IPO: This Bank Ltd has tabled its documents with the regulator to increase the amount of Rs. 1,350 through an initial public offering. One of India’s most important Small Finance Bank. The public issue of share value is Rs. 10 and the fresh issue amount of Rs. 750 Cr. The offer for sale by selling shareholder Utkarsh Coreinvest Ltd aggregated to Rs. 600 Cr. The section allocated for QIBs is up to 75 percent. Non-institutional investors reserved up to 15 percent. The retail investors would reserve up to 10 percent. As reported in the DRHP period. The company plans to use net proceeds generated by a new exchange to increase its level 1 capital base. However, its reserves loans and advances, satisfy potential capital needs. In consultation with designated lead managers, the organization will recommend raising Rs. 250 Cr in a pre-IPO placement.
According to the CRISIL survey, SFB is the rapidly growing Varanasi headquartered group which incorporated in 2016 and began operations in 2017, is a profitable small finance bank in the country as of FY 2020. The firm began its activities as an NBFC and later transformed it into an NBFC MFI to provide a shared responsibility community. Small ticket size revenue creation loans, and micro-companies credit to economically active disadvantaged women, with a strong understanding of the microfinance sector.
The Small Finance Bank with 528 bank outlets served as a largely untapped market of 2.74 million customers:
As of September 30th, 2020, the small finance bank with 528 bank outlets served as a largely untapped market of 2.74 million customers. Mostly from rural and semi-urban regions in Bihar, Uttar Pradesh, and Jharkhand. This bank has 33.66 to 54.48 percent disbursement respectively in CAGR deposits and payments. Between FY18-20 and as of 31st March 2020, SFB peers having the lowest gross and net NPA percentages.
The bank, which has a comfortable liquidity profile, a strong capital base, and a low cost to income ratio, offers a product suite that includes savings accounts, salary accounts, current accounts, recurring and fixed deposits, and locker facilities, as well as diversified liability products aimed at senior citizens, middle-class individuals, self-employed and salaried individuals.
Small Finance banks grew their AUM at a 30 percent CAGR between FY17 and FY20, and their loan portfolio is forecast to rise at a 22 percent CAGR in the immediate future. Arohan Financial Services, a leading NBFC MFI backed by Aavishkaar, recently filed for an IPO to raise 1,800 crores. According to its gross loan portfolio, the Kolkata-based corporation services 2.21 million borrowers in 17 states, making it the largest NBFC MFI in eastern India.