The IPO of Equitas Small Finance Bank (Equitas SFB) has opened for investment from Tuesday. This issue of Rs 518 crore can be subscribed till 22 October (Thursday). Equitas Small Finance Bank (SFB) is the country’s largest small finance bank based on banking outlets, while it is the second-largest SFB in the country based on asset under management and total deposits.
Equitas Small Finance Bank has fixed the price band of the IPO at Rs 32-33. 280 crore worth of new shares will be issued under this IPO. Apart from this, the allocation of 7.2 crore equity shares of the bank’s holding company Equitas Holding Limited will be done through Offer for Sale. The company will issue a total of 15.2 million shares in the IPO. In this, 8 crore fresh shares will be issued.
Some shares will be reserved for them
Shares worth Rs 1 crore will be reserved for bank employees and shares of Rs 51 crore for shareholders of Equitas Holdings. After this offer, Equitas Holdings’ stake in the bank will come down from the current level of 95.49 to 82-83 per cent.
What is the expert saying
Brokerage house MK Global has advised investing in Equitas Small Finance Bank IPO. He has set a target of Rs 64 for this, which is almost double the issue price. According to the brokerage, Superior Asset Diversification is the strength of Equitas. Apart from this, the liability profile is reasonable, the management is better, the return ratio is healthy and the biggest thing is the value is reasonable. Equitas is well capitalized, which is its strength. The bank has a focus on retail deposits, from which it is benefitting. At the same time, due to the diversified asset book, it is on the path of growth. Asset quality looks a risk, but it can be manageable.