SBFC Finance IPO: The Initial Public Offering (IPO) of SBFC Finance Ltd, a well-known financial institution that specializes in lending money to salaried people, self-employed people, small company owners, and entrepreneurs, is about to begin.
The IPO’s essential information and dates are included in this article along with the company’s history, financial results, and future growth plans.
IPO Details and Dates
The subscription period for SBFC Finance Ltd’s initial public offering (IPO) will begin on August 3 and end on August 7. The distribution of shares to anchor investors is scheduled on Tuesday, August 2, prior to the start of the subscription period. The price range for the IPO has not yet been disclosed by the firm, though.
The IPO consists of an offer for sale (OFS) of 425 crore and a fresh issue of equity shares totalling 600 crore. The total offer amount is increased to Rs. 1,025 crore by this combination.
Reduction in IPO Size
The amount of the IPO was decreased from 1,600 crore to 1,200 crore when SBFC Finance re-filed its papers with the Securities and Exchange Board of India (SEBI) in March.
Equity shares from various selling stockholders are offered for sale. Shares valued at 306 crore are planned for sale by Arpwood Partners Investment Advisors, while shares valued at 75 crore and 43 crore by Arpwood Capital and Eight45 Services, respectively, are also planned for sale.
Utilization of Net Proceeds
In order to meet future capital needs brought on by the growth of the business’s activities and assets, SBFC Finance intends to use the net proceeds from the IPO. This involves maintaining regulatory compliance, paying operational costs, and supporting expansion potential under the company’s lending verticals, which include forward lending under products like MSME loans and loans against gold.
Capital to Risk Weighted Assets Ratio (CRAR)
As of March 31, 2023, the firm has a Capital to Risk Weighted Assets Ratio (CRAR) of $14,135.76 million (equal to 31.90%), with Tier I capital of $14,049.52 million (equivalent to 31.71%) and Tier II capital of 86.24 million (equivalent to 0.19%). The net proceeds from the IPO are expected to be enough to cover SBFC Finance’s Tier-I capital needs.
Impact of Private Placement
Due to the completion of a private placement by SBFC Finance, which was carried out in conjunction with the promoter-selling shareholders and book-running lead managers, of up to 150 crore, the size of the new issue in the IPO was reduced.
Basis of Allotment and Listing Date
On August 10th, the basis for the share allocation for the SBFC Finance IPO will be decided. On Friday, August 11, refunds will be started, and on Monday, August 14, shares should be refunded to allottees’ demat accounts. On Wednesday, August 16, it is anticipated that the company’s IPO shares would list on the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE).
Company Background and Performance
SBFC Finance will have 137 branches distributed over 105 sites as of December 2022. The number of consumers served by the organization has increased dramatically, from 40,432 in FY20 to 94,997 now. The firm generated 525 crore in sales and 107 crore in profit for the nine months that ended in December.
Investors have the chance to join the recognized financial organization SBFC Finance and its varied loan portfolio through the SBFC Finance IPO. The firm intends to use the money acquired from the IPO to leverage its operations and strengthen its position in the lending market given its growth-oriented strategies and solid financial performance. In order to take part in this exciting offering, investors eagerly anticipate the disclosure of the IPO price band.