Capital Small Finance Bank has filed a draft red herring prospectus with the Securities and Exchange Board of India to raise funds via an initial public offering (IPO).
The IPO consists of a fresh issue of Rs 450 crore and an offer for sale (OFS) of up to 3.84 million shares by its shareholders and promoters.
The OFS comprises 3.37 lakh shares by PI Ventures LLP, up to 6.04 lakh shares by Amicus Capital Pvt Equity I LLP, 70,178 shares by Joint Investment Fund II, and up to 3.58 lakh shares by Gurdev Singh Samra.
The OFS also includes 2 lakh shares by Rashpal Singh, 2.85 lakh shares by Tarlochan Singh Hyare, 1.32 lakh shares by Avtar Singh Samra, 3.58 lakh shares by Gurnam Singh, 1.67 lakh shares by Ramesh Kaur, and up to 1.07 lakh shares by Parminder Singh.
The proceeds from the issue will be used for augmenting the Tier-I capital base to meet the bank's future capital requirements. As of June 2021, its Tier-I capital base was Rs 446 crore. Its capital to risk weighted assets ratio was 21.12%.
Edelweiss Financial Services, Axis Capital and SBI Capital Markets are the lead managers to the issue.
The lender's main focus is providing products and services to middle-income segment customers. It is backed by a number of institutional investors and financial institutions including SIDBI, PI Ventures LLP, OIJIF II, Amicus, ICICI Prudential and HDFC Life.
As of June 2021, the lender's deposits increased to Rs 54.83 billion against Rs 46.87 billion from a year ago. Advances for the period stood at Rs 36.42 billion versus Rs 31.45 billion last year.
For the June quarter, net interest income rose 20% from a year ago to Rs 570.49 crore. Net profit was Rs 12.18 crore from Rs 6.8 crore in the same quarter last year. Net non-performing assets increased to 1.44% from 1.27%. Provisions and contingencies rose Rs 10.40 crore against Rs 8.78 crore. CASA ratio was 40.48% versus 37.21%.
As of June 2021, the lender was present in four states -- Punjab, Haryana, Rajasthan and Delhi-- with 159 branches and 161 ATMs with 74% of its branches located in rural and semi-urban areas covering 19 districts and 77.35% of its total customers (both credit and deposit).