Fincare Small Finance Bank (SFB) has postponed its initial public offering (IPO) plan till July-August. The company attributed this to the severe injury to the banking sector due to the Corona epidemic and the huge volatility in the stock market due to the Russia-Ukraine crisis.
The bank’s managing director and CEO Rajiv Yadav told Moneycontrol in an interaction on Monday, March 14, that the bank now aims to be listed at the “best of the moment” in FY2023.
“We have all the regulatory approvals. However, this time is largely affected by the corona epidemic and its impact on the bank. In such a situation, there is a need to fix this before bringing the IPO. Obviously global issues are also a factor at this point of time, but I hope the impact will not last long. We have completed all the process of launching the IPO. So, we just want to make sure that when we do the IPO, there is a fair environment in the market at that time.”
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Plans to raise Rs 1,330 crore
Fincare Small Finance Bank (SFB) had submitted a draft red herring prospectus (DRHP) in May last year to raise money through the IPO. According to the document, the bank is trying to raise Rs 1,330 crore through IPO. This will include a fresh issue of Rs 330 crore and an offer-for-sale (OFS) from the promoters of Rs 1,000 crore. The bank will use the proceeds of the IPO to increase its Tier 1 capital.
This small finance bank in Bangalore started business four years ago. The company worked as a microfinance institution before it was converted into a small finance bank.
As per Reserve Bank of India’s (RBI) final approval terms and Small Finance Bank (SFB) guidelines, it has to list its equity shares on stock exchanges within three years of achieving a net worth of Rs 500 crore.
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