ICICI Bank to float IPO of stock brokerage unit
Photo Credit: Shah Junaid/VCCircle

ICICI Bank Ltd, the country’s largest private-sector bank by assets, said on Tuesday its board has approved taking unit ICICI Securities Ltd public through an initial public offering.

ICICI Bank, which fully owns the stock brokerage and merchant banking arm, will sell a part of its stake through the IPO. The IPO is subject to requisite approvals and market conditions, the Mumbai-based bank said in a stock-exchange filing. Other details will be determined in “due course”, it said.

ICICI Securities will become the fourth group company to float an IPO.

ICICI Bank went public in 1998. Its life insurance arm, ICICI Prudential Life Insurance Co Ltd, went public in September 2016 via a Rs 6,056-crore ($904 million) public offering.

Its non-life insurance firm, ICICI Lombard General Insurance Co Ltd, went public last month through a Rs 5,701-crore offering.

ICICI Securities will join listed peers like Edelweiss Financial Services, Motilal Oswal Financial Services, IIFL Holdings Ltd, Emkay Global Financial Services Ltd and among half-a-dozen full-service brokerage firms.

VCCircle reported that Sanlam-backed stock brokerage firm SMC Global Securities Ltd, which twice tried to float a public issue in India, is now preparing for a US listing. The Delhi-based firm is looking to issue American Depositary Shares (ADS) worth as much as $80 million (Rs 515 crore) to investors.

ICICI Securities

Incorporated in March 1995, ICICI Securities provides institutional and retail broking, merchant banking, and advisory services to corporates, financial institutions, high net-worth individuals, and retail investors in India.

Formerly known as ICICI Securities and Finance Company Ltd, the firm also operates, an online broking platform to invest in equity, derivatives, currency futures, mutual funds, and other financial products. It provides research information, stock picks, and mutual fund recommendations.

The company operates out of 66 cities and towns in India besides having global offices in Singapore and New York, according to the company’s website.

In 2016-17, the brokerage and financial services firm facilitated 4 million retail customers by providing them with research, advisory and execution services for their investments, its annual report stated.

The corporate finance business strengthened its franchise in the equity capital markets business, with the firm leading the IPO markets. It managed 12 IPOs in 2016-17 with 57% market share.

ICICI Securities reported consolidated net profit of Rs 339 crore for 2016-17 compared with Rs 239 crore in the previous year. The jump in profitability was driven by an increase in fee income, offset, in part, by an increase in staff cost and other administrative expenses, as per the company’s annual report.

The declared four interim dividends on the equity share capital aggregated to 127.29% and amounted to Rs 205 crore in 2016-17 compared with Rs 161 crore in the year prior.

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