The initial public offering (IPO) by SBFC Finance will open for subscription on Thursday ( August 3). The NBFC has fixed its price band in the Rs 54-57 range. Investors can make a bid for a minimum of 260 shares, and its multiples thereof. The issue will conclude on Monday (August 7).
Incorporated in 2008, SBFC Finance is a systemically important, non-banking finance company. It provides its services in the form of secured MSME loans and loans against gold. The primary customer base of the NBFC includes entrepreneurs, small business owners, self-employed individuals, and salaried and working-class individuals.
The company is looking to raise Rs 1,025 crore through via a fresh issue size of Rs 600 crore and an offer-for-sale (OFS) of up to Rs 425 crore from its promoter including Arpwood Partners Investment Advisors, Arpwood Capital and Eight45 Services.
The net proceeds from the issue would be utilised towards augmenting the company’s capital base to meet their future capital requirements arising out of the growth of the business and assets, while the proceeds from OFS will go to the selling shareholders of the company.
SBFC Finance extends its services to entrepreneurs and small business owners who are underserved or unserved by traditional financial institutions. The company has an extensive pan-India network, expanded in over 466 districts in 16 Indian states and two union territories. They currently have 152 branches.
For FY23, SBFC Finance reported a net profit at Rs 149.74 crore with a total revenue from operations at Rs 740.03 crore. The company had clocked a net profit Rs 64.52 crore with a revenue from operations at Rs 530.70 crore in the year-ago period. Its AUM during the period increased to Rs 4,942.82 crore from Rs 3,192.18 crore.
The company has reserved shares worth Rs 10.25 crore for its eligible employee, who will get a discount of Rs 2 per share. 50 per cent of the net offer has been reserved for qualified institutional bidders, while 35 per cent shares will be reserved for retail investors. Non-institutional investors will get the remaining 15 per cent of the net offer.
ICICI Securities, Axis Capital and Kotak Mahindra Capital Company are the lead managers to the issue, while KFin Technologies has been appointed as the registrar to the issue. Shares of the company will be listed on both NSE and BSE with Wednesday, August 16 as the tentative date of listing.
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