ESAF Small Finance Bank to Launch IPO on November 3; Sets IPO price at Rs 57-60 per share

31 Oct 2023 , 09:53 AM

ESAF Small Finance Bank, headquartered in Kerala, is set to launch its Initial Public Offering (IPO) with specific details and schedules:

Details about the IPO:

• Price Band: The price range for the shares in the IPO is set at Rs 57-60 per share.
• IPO Schedule:
  • November 2: The anchor book opens for a day.
  • November 3-7: The IPO will be open for the public, closing on November 7.
• Fundraising: The bank aims to raise Rs 463 crore from the IPO. This includes Rs 390.7 crore from fresh share issuance and Rs 72.3 crore from an offer-for-sale (OFS) by existing shareholders.
• Utilization of Funds: The bank plans to use the net proceeds to augment its Tier-I capital base to meet future capital requirements, primarily due to the growth in the bank’s assets (loans/advances and investment portfolio) and to ensure compliance with RBI regulatory requirements on capital adequacy.

Offer Composition:

• Offer-for-Sale (OFS):
  • ESAF Financial Holding, a promoter, will sell shares worth Rs 49.26 crore.
  • Investors PNB Metlife India Insurance Company and Bajaj Allianz Life Insurance Company will sell shares worth Rs 12.67 crore and Rs 10.37 crore, respectively.
• Employee Reservation: The issue includes a reservation of Rs 12.5 crore worth of shares for the bank’s employees, offered at a discounted price of Rs 5 each on the final issue price.

Allocation Breakdown:

• Categories: The IPO’s net issue has been divided into segments:
  • 50% reserved for qualified institutional buyers.
  • 15% reserved for high net-worth individuals (non-institutional investors).
  • 35% reserved for retail investors.
• Investment Limits: Retail investors can invest a minimum of Rs 15,000 (250 shares) and a maximum of Rs 1,95,000 (3,250 shares), adhering to the IPO investment cap of Rs 2 lakh.

Trading and Listing:

• Allotment Date: The basis of allotment of IPO shares will be finalized by November 10.
• Crediting Shares: Successful investors will have the equity shares credited to their demat accounts by November 15.
• Listing Date: Trading for ESAF Small Finance Bank shares on the bourses will commence from November 16, as per the IPO schedule.

IPO Managers:

• Book Running Lead Managers: The managing team for the IPO consists of ICICI Securities, DAM Capital Advisors, and Nuvama Wealth Management.

The successful listing of ESAF Small Finance Bank will make it the sixth lender available for trading on the stock exchange following its IPO, joining other small finance banks such as Equitas, AU, Ujjivan, Suryoday, and Utkarsh.