Utkarsh Small Finance Bank IPO: The initial public offering (IPO) of Utkarsh Small Finance Bank (SFB) kicks off for subscription on Wednesday, July 12. The private lender is selling its shares in the range of Rs 23-25 apiece during the three-day bidding process, which concludes on Friday, July 14.
A day ahead of its IPO, Utkarsh SFB allocated 8.91 crore equity shares to 20 anchor investors at an issue price of Rs 25 apiece to garner Rs 222.75 crore. SBI Mutual Fund, ICICI Prudential, Kotak Mahindra Trustee, Aditya Birla Sun Life Trustee, Goldman Sachs, SBI Life Insurance, Edelweiss Trusteeship, Founders Collective Fund and AG Dynamics Funds participated in the anchor book.
Utkarsh Small Finance Bank IPO Dates
The public issue will open on July 12 and bidding will close on July 14. The anchor book, the part of qualified institutional buyers, was opened on July 11.
Utkarsh Small Finance Bank IPO Price Band
The small finance bank has set the price band for its issue at Rs 23-25 per share.
Utkarsh Small Finance Bank IPO Issue Size
The bank plans to raise Rs 500 crore from its offering that comprises only fresh issue portion.
Utkarsh Small Finance Bank IPO Objectives of Issue
Utkarsh Small Finance Bank will utilise net issue proceeds for augmenting its Tier – 1 capital base to meet its future capital requirements, besides issue expenses.
Utkarsh Small Finance Bank IPO Lot Size
Investors can bid for a minimum of 600 equity shares and in multiples of 600 shares thereafter. Hence, the minimum investment by retail investors in the public issue would be Rs 15,000 for one lot and the maximum investment would be Rs 1.95 lakh for 13 lots.
Up to 75 per cent of the issue size is reserved for qualified institutional buyers, 15 percent for high networth individuals, and the balance 10 percent for retail investors.
Utkarsh Small Finance Bank IPO About Bank
Utkarsh Small Finance Bank recorded the third fastest gross loan portfolio growth between FY19 and FY23 among SFBs at above Rs 6,000 crore, as per CRISIL report.
In October 2015, Utkarsh CoreInvest received the RBI in-principle approval to set up a small finance bank and after the same later incorporated Utkarsh Small Finance Bank as a wholly owned subsidiary in April 2016. After the obtaining RBI licence in November 2016, Utkarsh CoreInvest transferred its microfinance business to Utkarsh Small Finance Bank.
The small finance bank commenced its operations in January 2017, with operations across 26 states and Union territories through 830 banking outlets and 15,424 employees, as of March 2023.
Utkarsh Small Finance Bank IPO Listing and Allotment Dates
The finalisation of basis of allotment of IPO shares is going to take place by July 19 and the successful investors will get shares in their demat accounts by July 21. The refunds will be credited to bank accounts of unsuccessful investors by July 20.
Utkarsh Small Finance Bank, which will make its grand debut on the BSE and NSE on July 24 as per the IPO schedule in draft prospectus.
ICICI Securities and Kotak Mahindra Capital Company are the book running lead managers to the issue, while KFin Technologies is the registrar to the offer.
Utkarsh Small Finance Bank IPO GMP
The Utkarsh Small Finance Bank IPO GMP aka Grey Market Premium is Rs 15.
Utkarsh Small Finance Bank IPO Should you Invest?
Utkarsh SFB is in constant efforts to improve its business with deeper insights into customer trends, and develop customized products for its customer segments. It intends to further the growth through diversification of product offerings, customer segments and geography supported by technology, process and data analytics, said Reliance Industries.
“With improvement in NIM’s and NPAs in declining trend over the last three years, growth in earnings remains strong. On FY23 financials, the IPO is valued at 6.8 times P/E and 1.1 times P/BV, we recommend ‘subscribe’ to this issue for the long term,” it added.
Its SFB’s future prospects hinge on the monetary policy of RBI and the Government of India. The bank’s ability to provide their products and services in a cost-efficient manner is among their core strengths and their cost-to-income ratio was the lowest among SFBs with Gross Loan Portfolio of more than Rs 60 billion, said Anand Rathi.
“At the upper price band, the company is valuing at P/B of 1.39 times with a market cap of Rs 2,740 crore post issue of equity shares and return on net worth of 20.22 per cent. We believe that the company is fairly priced and recommend a ‘subscribe- long term’ rating to the IPO,” it added.
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