Microlender-turned-bank Bandhan Bank Ltd made a positive trading debut on Tuesday, with its shares listing at a premium of nearly 30% to its issue price.
Shares of Bandhan Bank began trading on the BSE Sensex at Rs 485 apiece, up 29.33% from the initial public offering price of Rs 375 apiece, stock-exchange data showed. The stock touched a high of Rs 498.40 and a low of Rs 455 on the first day of trade. It closed at Rs 477.20, up 27.25%.
Bandhan Bank is now the eighth most valued bank among all listed Indian lenders with a market captialisation of Rs 56,920 crore.
The BSE’s 30-stock benchmark Sensex ended up 0.33% in a volatile session. The BSE Bankex advanced 0.93% at the close on Tuesday.
Bandhan Bank, India’s first microfinance lender to receive a universal banking licence, had sought Rs 44,730.18 crore ($6.86 billion) in valuation from its maiden public offering.
It is the eighth company to list on the main board of the bourses in 2018. Four of the previous seven had gained on debut.
The positive start follows an initial public offering that received strong investor turnout led by institutional demand. The IPO was subscribed nearly 15 times.
The public issue comprised a fresh issue of 97.66 million shares worth Rs 3,662.39 crore at the upper end of the price band, and a sale by IFC – directly and through its fund IFC FIG Investment Company.
In all, IFC sold 21.61 million shares against its total holding of 54.04 million shares. IFC's stake has declined to 2.71% stake after accounting for the fresh issue of shares, VCCircle estimates show.
The private investment arm of the World Bank group held a stake of roughy 5% prior to the IPO.
The stake of the promoter entity, Bandhan Financial Holding Ltd, has declined to 82.28% after the issue from 89.62%. The promoter will get three years, from the date of listing, to bring its stake down to 75%, to comply with the minimum public holding norms.
The microfinance lender had filed its draft prospectus on 1 January. It had received regulatory nod on 28 February.
Kotak Mahindra Capital Co, Axis Capital, Goldman Sachs (India) Securities, JM Financial Institutional Securities and JP Morgan India managed the IPO.