Capital Small Finance Bank IPO opens today: Should you subscribe?
Ahead of the bidding, the Capital Small Finance Bank raised ₹57 crore from anchor investors. Whiteoak Capital, Nippon Life India, Edelweiss Tokio Life Insurance, Ashoka India Equity Investment Trust, 360 ONE Mutual Fund, HDFC Life Insurance Company, Ananta Capital Ventures Fund, ICICI Prudential Life Insurance Company, SBI General Insurance Company, Kotak Mahindra Life Insurance Company participated in the company’s anchor book.
Capital Small Finance Bank GMP Today
The company’s shares in the grey market continued trading at a premium of ₹43. This indicates an estimated listing price of ₹511, up 9.19 percent from the IPO price of ₹465. The GMP was the same as in the previous session (February 6). However, it declined from ₹47 on February 5 and ₹50 on February 4.
However, one must note that grey market premium is only an indicator of how the company’s shares are performing in the unlisted market and can change quickly.
Capital Small Finance Bank IPO: Should you buy?
Anand Rathi: Subscribe for long term.
Capital Small Finance Bank is Retail focused liability franchise with a high share of CASA. It has a Secured and diversified advanced portfolio. Their credit assessment processes and risk management practices enable them to maintain good asset quality and low delinquencies. They
have gained an understanding of their market and customer base over the years, enabling them to meet the financial requirements of their existing and potential customers.
Read here: Rashi Peripherals IPO: GMP, issue details, 10 key things to know
At the upper price band company is valuing at a P/B of 2.01x, with a market cap of ₹21,080 million post issue of equity shares and a return on net worth of 15.33 percent.
The brokerage believes that the valuation of the company is fairly priced and recommends a “Subscribe-Long Term” rating to the IPO.
Dilip Davda: May Subscribe
This small finance bank is currently a north region-centric financial service provider and mulls Pan India’s presence in coming years with the expansion of its branch network. For the reported periods, it posted steady growth in the top and bottom lines. Based on FY24 annualized earnings, it appears aggressively priced issue. Well-informed investors may park funds for the long-term rewards, believes Dilip Davda, Contributing Editor at Chittorgarh.com.
Capital Small Finance Bank IPO Details
The issue is a combination of a fresh issue of 96 lakh shares aggregating to ₹450.00 crore and an offer for sale of 16 crore shares aggregating to ₹73.07 crore. The minimum lot size for an application is 32 shares and in multiples thereof. The minimum amount of investment required by retail investors is ₹14,976.
The bank proposes to utilise the net proceeds from the fresh issue towards augmenting the Tier-I capital base to meet future capital requirements. Further, the proceeds from the fresh issue will also be used towards meeting the expenses in relation to the offer.
Nuvama Wealth Management Limited, Dam Capital Advisors Ltd (Formerly IDFC Securities Ltd), and Equirus Capital Private Limited are the book-running lead managers of the Capital SFB IPO, while Link Intime India Private Ltd is the registrar for the issue.
The allotment for the Capital SFB IPO is expected to be finalised on Monday, February 12, 2024. Capital SFB IPO will list on BSE, NSE with the tentative listing date fixed as Wednesday, February 14, 2024.
About Capital Small Finance Bank
In 2015, Capital SFB became the first non-NBFC microfinance entity to receive the SFB license. The company has a strong presence in semi-urban and rural areas with a branch-based operating model. Capital Small Finance Bank is headquartered in Jalandhar, Punjab, and has strategically expanded its SFB operations in northern states of India such as Punjab, Haryana, Rajasthan, Delhi, Himachal Pradesh and UT Chandigarh. As of June 30, 2023, Capital Small Finance Bank had a presence in five states and one union territory, with a total of 172 branches and 174 ATMs.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decision.
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Published: 07 Feb 2024, 09:10 AM IST
