ESAF Small Finance Bank is set to launch its IPO on Thursday, November 3, with public subscription running until Monday, November 7. The bank plans to raise ₹463 crore ($6.2 billion) through the issuance of fresh equity shares worth ₹390.7 crore and an offer for sale (OFS) of ₹72.3 crore by ESAF Financial Holdings, PNB MetLife (NYSE:MET) India Insurance Company, and Bajaj Allianz (ETR:ALVG) Life Insurance Company.
The Securities and Exchange Board of India (Sebi) approved the IPO on October 17, allowing the bank to bolster its Tier – I capital base. The IPO allocation includes 50% for qualified institutional buyers, 15% for non-institutional investors, and 35% for retail investors. Additionally, ₹12.5 crore worth of shares are reserved for employees.
Following the conclusion of the IPO, share allocation is expected to take place on November 10, with credits to investors' demat accounts by Tuesday, November 15. The shares are then targeted for listing on both the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) on Wednesday, November 16.
ESAF Small Finance Bank reported a net profit of ₹302.3 crore for FY23 and assets under management (AUM) of ₹16,331.26 crore (INR100 crore = approx. USD12 million). The bank's deposits surged to ₹14,665.62 crore in March 2023, marking a compound annual growth rate (CAGR) of 27.66%. Meanwhile, AUM registered a CAGR of 39.22%.
The bank operates a network of over 700 outlets and is committed to responsible banking with a mandate to allocate 75% of its net bank credit to priority sectors. Its primary target is rural and semi-urban areas where it provides various loan services.
The IPO's book building process is being managed by ICICI Securities, DAM Capital Advisors, and Nuvama Wealth Management, with Link Intime India serving as the registrar. Upon listing, ESAF Small Finance Bank will join a community of over 2 million industry professionals on BSE and NSE.
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