1. Capital Small Finance Bank IPO opens for subscription, check all key details

Capital Small Finance Bank IPO opens for subscription, check all key details

blog author image

Upstox

blog verification badge

3 min read • Updated: February 7, 2024, 1:35 PM

Facebook PageTwitter PageLinkedin Page

Summary

The IPO consists of fresh issuance of shares worth ₹450 crore and an offer for sales of shares worth ₹73 crore. The investors can bid for a minimum of 32 shares and in multiples of the same thereafter.

IPO.webp
Capital SFB has fixed a price band of ₹445-₹468 per share.

It’s raining IPOs in India with around 10 companies hitting the capital market in February alone. Even this week, multiple new initial public offerings are going to enter the primary markets. One of the leading names is the Capital Small Finance Bank. The ₹523-crore book-built issue of Capital SFB is opening today for subscription. In case you are planning to subscribe to Capital SF, here are some of the things you need to know as an investor in order to make an informed decision.

About the company

Jalandhar-based Capital Small Finance Bank Ltd is India’s first small finance bank that started operations in 2016. The company was incorporated in 1999 and operated as India’s largest local area bank till it got the Small Finance Bank licence in 2015. The bank offers fully secured loans to micro, small and medium enterprises (MSMEs), farmers and traders. It also provides mortgages, predominantly for housing loans. It currently operates through 173 branches across five states and one Union Territory. Its business is mostly concentrated in Punjab.

The bank’s profit after tax increased 49.6% to ₹93.60 crore in FY23 compared with ₹62.56 crore in FY22. Net interest income (NII) stood at ₹322 crore during the fiscal year compared with ₹255 crore a year ago.

About the offer: Lot size, subscription and price band

The Capital Small Finance Bank IPO would be open for subscription for three days from 7 February to 9 February. The company has fixed a price band of ₹445-₹468 per share. Bids can be made for a minimum of 32 shares and in multiples of the same thereafter.

The IPO consists of fresh issuance of shares worth ₹450 crore and an offer for sales of shares worth ₹73 crore. Oman India Joint Investment Fund II and Amicus Capital are among the selling shareholders in the OFS.

Capital Small Finance Bank said that it would utilise the proceeds from the fresh issue towards augmenting its tier-I capital base to meet its future capital requirements.

Capital SFB raises ₹156.92 crore from anchor investors

The bank has reserved 50% of the issue for qualified institutional buyers (QIB), 35% of the issue for retail investors and 15% for non-institutional investors (NIIs).

Notably, Capital Small Finance Bank has already raised ₹156.92 crore through its anchor book launched a day before the IPO opening on 6 February.

In a filing to exchanges, the company said that it has finalised allocation of 33,53,013 equity shares to anchor investors at a price of ₹468 apiece.

Capital Small Finance Bank IPO share allotment

The allotment of shares for Capital SFB IPO is likely to be finalised by 12 February and the listing on BSE and NSE is expected on 14 February.

Capital Small Finance Bank GMP

According to reports, Capital Small Finance Bank’s shares are trading at a premium of ₹43 in the grey market as on 7 February. This hints at a listing at around ₹511 levels, which is over 9% higher than the upper end of the IPO price range.

However, it is important to remember that the value of the grey market premium (GMP) keeps changing daily depending on the demand for shares before their listing and only acts as an indicator on how the IPO may perform on listing.