ESAF Small Finance Bank IPO Subscribed 1.74 Times On Day 1

ESAF Small Finance Bank launched its initial public offering on Nov. 3. The IPO issue will close on Nov. 7.

The Kerala-based bank is seeking to secure a total of Rs 463 crore in funding. It plans to generate Rs 390.7 crore through the issuance of fresh equity shares, while the remaining amount will be acquired through an offer for sale. The other selling shareholders are PNB Metlife and Bajaj Allianz Life Insurance.

The company plans to utilise the proceeds towards augmentation of their Tier-1 capital base and increasing its onward lending business. Raising of funds also helps them to ensure compliance with regulatory requirements on capital adequacy.

• Issue opens: Nov. 3

• Issue closes: Nov. 7

• Fresh issue size: Rs 390.7 crore

• OFS size: Rs 72.3 crore

• Total issue size: Rs 463 crore

• Price band: Rs 57–60 per share

• Lot size: 250 shares

• Face value: Rs 10 per share

• Listing: BSE and NSE

The company has not undertaken any pre-IPO placement.

ESAF provides micro, retail and corporate banking, para-banking activities like debit cards, and third-party financial distribution, in addition to Treasury and permitted foreign exchange business. ESAF commenced their business in March 2017 and was included in the second schedule to the RBI Act in November 2018.

The lender predominantly focuses on unbanked and underbanked segments, especially in rural and semi-urban centers. As of June, 63% of their gross advances and 71.7% of their branches were dedicated to customers from these centres.

The bank's assets under management have nearly doubled between March 2021 and 2023 and stand at Rs 17,204 crore as of the first quarter.

The lender has 700 banking outlets and 767 customer service centres across 21 states and 2 union territories, with 62% of their banking outlets being in southern India.

The IPO has been subscribed 1.74 times as of 5:00 p.m. on Friday.

• Institutional investors: 0.90 times or 90%

• Non-institutional investors: 2.44 times

• Retail investors: 1.98 times

• Employee Reserved: 1.01 times