Fincare Small Finance Bank has filed a prospectus for a Rs 1330 crore initial public offering (IPO), with Rs 330 crore in new stock and Rs 1,000 crore in offer for sale equity. Fincare SFB serves India’s unbanked and underbanked populations in rural areas.
The small financing bank primarily serves the unbanked and underbanked populations in rural India. According to a CRISIL assessment, Fincare SBF had the highest growth rate in advances among peers between 2017 and 2020.
Fincare offers banking services as well as access to savings and other financial products to individuals, MSMEs, and other unorganized companies.
Fincare Small Finance Bank Ltd. Objective
- The bank intends to use the net proceeds from the sale of additional shares to increase its capital base in Tier 1 cities and fulfill future capital needs.
Why should you invest in the Fincare Small Finance Bank Ltd. IPO?
Here are our top reasons.
- The bank and promoters are backed by marquee investors, including True North Fund VLLP, Wagner Limited, Tata Opportunities Fund, LeapFrog Investments, SIDBI, Kotak Mahindra Life Insurance, and Edelweiss Tokio Life Insurance.
- The bank has a fourteen-year track record of offering rural Indian customers savings and other financial products.
- They have a large network of 528 banking locations, 219 business correspondent locations, and 108 ATMs in sixteen states and three union territories.
Fincare Small Finance Bank IPO Financials
| Particulars | FY21 | FY20 | FY19 |
|---|---|---|---|
| Revenue From Operation | NA | NA | NA |
| EBITDA | 1,471.10 | 2,196.29 | 1,224.95 |
| EBITDA Margin (%) | NA | NA | NA |
| Profit After Tax | 1,434.49 | 1,019.80 | 975.50 |
| EPS | NA | NA | NA |
| ROE | 18.41 | 22.00 | 24.76 |
Know before investing
Strengths
- The brand’s strength is a customer-centric approach that provides businesses and individuals with affordable financial products and services to meet their needs.
- The bank offers an inclusive product suite that offers financial products covering the entire lifecycle of rural customers.
- They have a long track record of serving rural customers, especially microloan borrowers.
Risks
- Industry competition can concern prospective investors primarily because the company operates in a restrictive area.
- Challenges in maintaining the growth rate associated with expansion will impact the bank’s future cash flow.
- Invest if you know the unique risks associated with the microlending business.
Fincare Small Finance Bank Peer Comparison
| Company Name | Total Income (in Rs million) | P/E | EPS |
|---|---|---|---|
| Fincare Small Finance Bank Ltd. | 12,157.20 | NA | 24.43 |
| Peer Group | |||
| AU Small Finance Bank Ltd. | 49,919.76 | 41.35 | 22.78 |
| Bandhan Bank Limited | 30,237.37 | 16.58 | 18.78 |
| CreditAccess Grameen Ltd. | 17,054.80 | 25.89 | 23.20 |
| Equitas Small Finance Bank Ltd. | 29,277.96 | 24.27 | 2.39 |
| Ujjivan Small Finance Bank | 30,258.10 | 13.56 | 2.19 |
| Spandana Sphoorty Financial Ltd | 14,695.06 | 10.61 | 56.21 |
| Suryoday Small Finance Bank Ltd. | 8,541.38 | 18.39 | 13.38 |
Fincare Small Finance Bank Ltd. IPO FAQs :
Q1. What is Fincare Small Finance Bank Ltd. IPO?
Ans. Fincare Small Finance Bank Ltd. has filed for a Rs 1330 crore IPO consisting of new shares worth Rs 330 crore and an offer for sale of Rs 1000 crore equity shares.
Q2. When will Fincare Small Finance Bank Ltd. IPO allotment be available?
Ans. Details not available.
Q3. What will be Fincare Small Finance Bank Ltd. IPO lot size?
Ans. Details not available.
Q4. When will Fincare Small Finance Bank Ltd. IPO open for subscription?
Ans. Details not available.
Q5. What minimum lot size can retail investors subscribe to?
Ans. Retail investors can apply for a minimum of one lot.
Q6. When will Fincare Small Finance Bank Ltd. list on exchanges?
Ans. It usually takes ten working days from the last day of subscription to list the IPO on the bourses.
Q7. What would be the listing gains on Fincare Small Finance Bank Ltd. IPO?
Ans. Listing gain is the difference between the IPO’s opening and offer prices. The listing gain results from changing investors’ interests, global parameters, and short vs long-term outlooks.
Q8. I have finished the application process for Fincare Small Finance Bank Ltd. IPO, but the funds are not yet debited. What is the reason?
Ans. The bank initially blocks the amount you bid for an IPO. It will debit the amount when the shares get allotted or unblock it after the UPI mandate expiry date.
Q9. How to approve the UPI mandate request for Fincare Small Finance Bank Ltd. IPO?
Ans. Login to your UPI handle and approve the payment mandate to complete the IPO application process.
Q10. Can I submit more than one application for the public issue of Fincare Small Finance Bank Ltd. using one PAN?
Ans. You can submit only one application using one PAN card.
Q11. What is the minimum order quantity for Fincare Small Finance Bank Ltd. IPO?
Ans. The minimum size of the application will be one lot.
