According to market sources, the company’s shares are commanding a premium of Rs 15 in the unlisted market, which indicates a robust listing gain of around 60%.
The Rs 500 crore-IPO of Utkarsh Small Finance Bank received a massive response from investors with the issue getting subscribed nearly 102 times at close.
The part reserved for qualified institutional buyers (QIBs) was subscribed 124.8 times, while that for non-institutional investors (NIIs) was subscribed 81.6 times. Meanwhile, the retail quota was subscribed 72.1 times.
A day prior to the issue opening, Utkarsh Small Finance Bank had raised Rs 223 crore from anchor investors.
Brokerages have expressed confidence in the IPO, highlighting its strong market presence, resilient performance and growth prospects.
The bank’s focus on cost efficiency, expanding product offerings, and diverse customer segments have been viewed positively.Incorporated in 2016, Utkarsh commenced operations in 2017, and its product suite includes a range of deposit products, including saving accounts, salary accounts, current accounts, recurring and fixed deposits, and locker facilities.
While the topline remained healthy at a CAGR of 26% over FY21-23, bottomline growth in FY22 was muted following the general market trends after the pandemic. Its net NPAs stood at 1.33%, 2.31%, and 0.39% for FY21, FY22, and FY23, respectively.
The bank recorded the third-fastest gross loan portfolio growth between fiscal 2019 and fiscal 2023 among peers, with a gross loan portfolio of over Rs 6,000 crore.
For the year ended March 2023, the company recorded a total income of Rs 2,804 crore, while net profit for the same period stood at Rs 404 crore.
Proceeds from the fresh issue will be utilised to augment the lender’s Tier-1 capital base to meet future capital requirements.
ICICI Securities and Kotak Mahindra Capital Company acted as the book-running lead managers to the issue.
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