ESAF Small Finance Bank Sets IPO Price Band at ₹57-₹60 per Share

ESAF Small Finance Bank Sets IPO Price Band at ₹57-₹60 per Share

VoM News Desk | October 31, 2023 | 12:36 PM IST | Breaking News | Follow on Google News

ESAF Small Finance Bank Sets IPO Price Band at ₹57-₹60 per Share

ESAF Small Finance Bank Sets IPO Price Band at ₹57-₹60 per Share

ESAF Small Finance Bank has announced the pricing details for its initial public offering (IPO), setting the price band at ₹57 to ₹60 per equity share with a face value of ₹10. The bank’s IPO subscription period is scheduled to open on Friday, November 3, and close on Tuesday, November 7. Prior to this, the allocation of shares to anchor investors is expected to take place on Thursday, November 2.

IPO Price Range and PE Ratio

The price range for the ESAF Small Finance Bank IPO reflects a floor price that is 5.70 times the face value of the equity shares and a cap price that is 6.00 times the face value. The price-to-earnings (PE) ratio based on diluted earnings per share for fiscal year 2023 at the floor price is 8.49 times, while at the cap price, it is 8.94 times.

IPO Lot Size and Allocation

ESAF Small Finance Bank’s IPO lot size is set at 250 equity shares, and investors can subscribe in multiples of 250 equity shares thereafter. The IPO offers not more than 50% of the shares to Qualified Institutional Buyers (QIBs), not less than 15% to Non-Institutional Investors (NIIs), and at least 35% of the offer is reserved for Retail Investors. Additionally, eligible employees participating in the employee reserve portion will receive a discount of ₹5 per equity share.

IPO Details and Utilization of Proceeds

The ESAF Bank IPO comprises a fresh issuance of equity shares worth ₹390.7 crore by the company, along with an offer-for-sale (OFS) of equity shares valued at ₹72.3 crore by three shareholders. The company aims to raise ₹463 crore through the IPO.

In the OFS, promoter ESAF Financial Holdings will sell shares worth ₹49.26 crore, while PNB MetLife India Insurance Company and Bajaj Allianz Life Insurance will offload shares worth ₹23.04 crore. The bank plans to use the net proceeds from the fresh issue to bolster its Tier – I capital base in preparation for future capital requirements.

About ESAF Small Finance Bank

ESAF Small Finance Bank was established in 1992 and focuses on providing financial services to clients residing in rural and semi-urban areas. The bank’s offerings include microloans, retail loans, MSME loans, loans to financial institutions, and agricultural loans. As of March 2023, the bank’s network includes 700 locations, 743 customer service centers, 20 business correspondents, and 481 business facilitators. It operates 581 ATMs across 21 Indian states. In FY23, the bank’s net profit more than doubled to ₹302.3 crore, and its net interest income (NII) reached ₹1,836.3 crore with a 60% YoY increase. ESAF Small Finance Bank’s assets under management (AUM) showed the highest compound annual growth rate (CAGR) among its peers, growing from ₹8,425.93 crore on March 31, 2021, to ₹16,331.26 crore on March 31, 2023.

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VoM News Desk

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