Spandana Sphoorty Financial will launch its initial public offering (IPO) on Monday, i.e. 5 August, at a price band of Rs 853-856 per share to raise about Rs 1,200 crore. The Andhra Pradesh-based microfinance lender offers income-generation loans under the joint-liability group model, predominantly to women from low-income households in rural areas. The issue will close on 7 August. If you are planning to invest in the Spandana Sphoorty IPO, here are 10 key things you should know:
-- The issue consists of a fresh issue of Rs 400 crore and an offer for sale (OFS) by promoters and investors of up to 9.3 million shares to raise approximately another Rs 800 crore.
-- The funds raised through the fresh issue will be used towards augmenting the capital base of the lender to meet future capital requirements.
-- Spandana Sphoorty has already raised Rs 360 crore from 18 anchor investors at Rs 856 a share, the upper end of the IPO price band. It issued 4.2 million shares to the anchor investors, including Goldman Sachs, Aditya Birla Sunlife Insurance Co. Ltd and Citigroup Global Markets Mauritius Pvt. Ltd.
-- Spandana Sphoorty is the fourth largest NBFC-MFI in India in terms of assets under management (AUM), which stood at Rs 4,437 crore as of March 2019.
-- During FY19, the company’s net interest income grew 87.5% to Rs 640 crore, while net profit jumped 66% to Rs 312 crore.
-- As of June, Spandana Sphoorty had 7,062 employees (including 5,051 credit assistants) operating out of 929 branches in 269 districts across 16 states and 1 union territory in India.
-- Kangchenjunga Ltd, incorporated under Mauritius laws and promoted by Kedaara Capital, is currently the largest shareholder in the company with 59.14% stake, followed by Padmaja Gangireddy who has 19.57% shareholding. Among other shareholders, Valiant Mauritius Partners FDI Ltd, JM Financial India Trust II, Vijaya Siva Rami Reddy Vendidandi and Helion Venture Partners II LLC hold 7.77%, 5.56%, 2.5% and 1.3% stake, respectively.
-- Promoter (Kangchenjunga Limited, Padmaja Gangireddy and Vijaya Siva Rami Reddy Vendidandi) shareholding will be reduced to 62.58% from 81.22% after the IPO.
-- The equity shares of the company are proposed to be listed on both BSE and the National Stock Exchange of India (NSE).
-- Axis Capital, ICICI Securities, IIFL Securities, JM Financial, IndusInd Bank and Yes Securities are the book running lead managers to the issue.
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