Utkarsh Small Finance Bank IPO: 10 Key Facts to Know
Utkarsh Small Finance Bank’s IPO subscription opens this week, while the anchor investor bidding takes place today. As one of India’s prominent small finance institutions, Utkarsh Small Finance Bank has established a nationwide presence. It is promoted by Utkarsh CoreInvest Ltd, which originated as an NBFC in Fiscal 2010 and focused on providing microloans to underserved regions, particularly in Uttar Pradesh and Bihar. Earlier, the bank had submitted a draft red herring prospectus (DRHP) in July 2021 to raise ₹1,350 crore through a new issue (₹750 crore) and an offer for sale (OFS) by Utkarsh Coreinvest (₹600 crore).
Utkarsh Small Finance Bank made revisions to its IPO plans and submitted modified documents to SEBI in August 2022. The bank decided to reduce the size of the offering by 63% and aim to raise ₹500 crore instead of the initially targeted ₹1,350 crore.
Crucial Details of The Utkarsh Small Finance Bank IPO:
Anchor Investor Auction: The auction for anchor investors is scheduled to commence on Tuesday, July 11.
Price Range: Utkarsh Small Finance Bank has determined a price band of ₹23 to ₹25 per equity share for its upcoming initial public offering.
Issue Details and Size: As stated in the red herring prospectus (RHP), the Utkarsh Small Finance Bank IPO consists solely of fresh equity shares, amounting to a total of ₹500 crore. There is no offer for sale (OFS) component included. The face value of each equity share stands at ₹10.
Lot Size: The minimum bid lot consists of 600 equity shares, and investors can bid in multiples of 600 equity shares.
Allotment and Listing: Share allotment will be finalized on July 19, with refunds initiated on July 20. The credited shares will be deposited into the demat accounts of allottees by July 21. Utkarsh Small Finance Bank shares are expected to be listed on both the BSE and NSE exchanges on July 24.
Lead Manager and Registrar: ICICI Securities Ltd and Kotak Mahindra Capital Company Ltd serve as the book running lead managers for the IPO, while KFin Technologies Ltd acts as the registrar for the issue.
Promoter Shareholding: Utkarsh CoreInvest Limited, formerly known as Utkarsh Micro Finance Limited, is the exclusive promoter of the bank. As of the Red Herring Prospectus date, the promoter and its nominees collectively held 759,272,222 equity shares, representing 84.75% of the pre-Issue issued shares.
IPO Objective: The IPO aims to enhance the bank’s tier I capital base and meet future capital requirements. The proceeds from the issue will be utilized for this purpose. As of March 2023, the bank’s tier-1 capital base stood at ₹1,844.82 crore, accounting for 18.25% of its total capital.
IPO Reservation: Qualified Institutional Buyers (QIBs) have a reservation of at least 75% of the shares in the public issue, while Non-Institutional Investors (NIIs) are allocated a maximum of 15%. The offer reserves not more than 10% of the shares for Retail Investors.
Summary
Utkarsh Small Finance Bank is launching its IPO, targeting to raise ₹500 crore through a fresh issue of equity shares. The price range is set at ₹23 to ₹25 per share. The IPO aims to enhance the bank’s capital base and meet future capital requirements. The allotment and listing are expected to take place in July. The bank is promoted by Utkarsh CoreInvest Ltd and has a strong presence across India.
