Utkarsh Small Finance Bank is gearing up for its highly anticipated Initial Public Offering (IPO), set to open for subscription on July 12.
The bank aims to raise Rs 500 crore through the issuance of new shares with a face value of Rs 10 each. As market excitement builds, signals from the gray market suggest a strong position for Utkarsh SFB shares.
The IPO price band has been fixed at Rs 23-25 per share, with the gray market premium (GMP) currently indicating a premium of Rs 15, reflecting a potential listing at a remarkable 60% premium.
However, experts advise investors to base their decisions on the company’s financials and fundamentals rather than relying solely on the gray market signals.
Utkarsh SFB IPO Details
Utkarsh Small Finance Bank’s IPO, with a target size of Rs 500 crore, will be open for subscription from July 12 to July 14.
Interested investors can participate in the IPO within the price band of Rs 23-25 per share, with a lot size of 600 shares.
The issue allocation is as follows: 75% for Qualified Institutional Buyers (QIBs), 15% for Non-Institutional Investors (NIIs), and 10% for retail investors.
The allotment of shares is expected to be finalized on July 19, and the listing date has been set for July 24.
The funds raised through the IPO will be utilized to strengthen the bank’s Tier-I capital base and cover issue-related expenses. Tier-I capital plays a crucial role in meeting future capital requirements.
Utkarsh SFB Overview
Established in 2016, Utkarsh Small Finance Bank has demonstrated impressive growth, ranking second among Small Finance Banks (SFBs) in terms of Assets Under Management (AUM) growth in FY2019 and FY2022, with AUM exceeding Rs 5,000 crore.
The bank offers a wide range of services including bank accounts and deposits, cards, insurance and investments, as well as loans.
In terms of financial performance, Utkarsh SFB’s net profit has experienced fluctuations in recent years.
It recorded a net profit of Rs 1.87 crore in the financial year 2020, which decreased to Rs 1.12 crore in the following year.
However, in FY2022, the net profit declined further to Rs 61.46 lakh. Encouragingly, the bank’s financials showed improvement in the last fiscal year, with the net profit increasing to Rs 4.
