ESAF Small Finance Bank files for $135 mn IPO
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ESAF Small Finance Bank files for $135 mn IPO

By TEAM VCC

  • 06 Jan 2020
ESAF Small Finance Bank files for $135 mn IPO
Credit: Thinkstock

ESAF Small Finance Bank on Monday filed its draft red herring prospectus with the Securities and Exchange Board of India for an initial public offering of Rs 976 crore ($135.6 million).

The IPO comprises a fresh issue worth Rs 800 crore and an offer for sale by existing shareholders aggregating up to Rs 176.2 crore, according to the draft prospectus.

The Thrissur, Kerala-based bank may also consider a pre-IPO placement of shares to raise up to Rs 300 crore. If it does a pre-IPO sale, it will reduce the amount from the fresh issue in the IPO.

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The bank said it will use the net proceeds from the fresh issue to augment its Tier-I capital to meet future capital requirements.

The lender has hired Axis Capital Ltd, Edelweiss Financial Services Ltd, ICICI Securities Ltd and IIFL Securities Ltd to manage the public offering. VCCircle had first reported in August last year that the bank had shortlisted these four bankers to arrange the share sale.

ESAF Small Finance Bank operates in 16 states and one union territory through 403 branches and 38 ultra-small branches, serving about 3.73 million customers.

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ESAF started as a non-government organisation in 1992 and became a microfinance institution in 2008. In 2015, it received an in-principle licence from the Reserve Bank of India to launch a small finance bank. ESAF Small Finance Bank was incorporated in May 2016. 

ESAF will join a number of its peers on the stock markets. AU Small Finance Bank floated its IPO in 2017. Ujjivan Small Finance Bank Ltd listed its shares last month while Equitas Small Finance Bank filed its IPO prospectus.

Fincare Small Finance Bank Ltd said last year it was looking to go public by 2021 after raising fresh funding from existing investors including TA Associates, Leapfrog Investments and Tata Opportunities Fund.

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