India's largest asset manager, SBI Fund Management Ltd., has a race against time to file its preliminary IPO papers by the end of March as it seeks a valuation of around Rs 1.3 lakh crore.
The company is looking to raise Rs 13,000 crore through an offer for sale, which would rank them among the largest public listings in the financial services sector. Sources have told NDTV Profit SBI MF has an end-of-March deadline to file its Draft Red Herring Prospectus (DRHP), which could prove to be critical.
That is because if the company fails to file the DRHP by this window, the IPO process could face significant delays as the firm would likely be required to conduct a fresh audit of its financial records to include the most recent fiscal data.
The filing was originally targeted for late February but was pushed back due to an extensive and detailed audit exercise.
The SBI MF IPO is structured entirely as an offer for sale, which means the company will not receive any proceeds. State Bank of India, the country's largest lender, plans to offload 6.3% stake, potentially fetching more than Rs 8,000 crore. Its joint venture partner, France-based Amundi Asset Management, is also expected to trim a portion of its holding for nearly Rs 5,000 crore.
The company is seeking a price-to-earnings ratio of roughly 51 times, which is slightly higher than its rival, ICICI Prudential AMC. Despite the ambitious pricing, however, shares in the unlisted market are reportedly trading at a valuation of Rs 1.5 lakh crore.
To manage the listing, SBI Fund Management has appointed nine merchant bankers, including Bank of America, HSBC, and Kotak. In a move toward cost efficiency, the firm intends to cap IPO expenses at Rs 75 crore —roughly half of what was spent on the ICICI Prudential AMC offering.
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