Day two: RBL Bank’s IPO oversubscribed 3 times

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Mumbai | Updated: August 23, 2016 7:58:34 AM

The initial public offering (IPO) of RBL Bank was subscribed 3.08 times with investors bidding for 11.68 crore shares of the total 3.79 crore shares on offer.

In a pre-IPO placement held on December 16, 2015, RBL Bank allotted 2.5 crore shares at a price of R195 per share to investors, amounting to R487.5 crore. CDC Group, Asian Development Bank, DVI Fund (Mauritius) were among these investors. (Source: Reuters)In a pre-IPO placement held on December 16, 2015, RBL Bank allotted 2.5 crore shares at a price of R195 per share to investors, amounting to R487.5 crore. CDC Group, Asian Development Bank, DVI Fund (Mauritius) were among these investors. (Source: Reuters)

The initial public offering (IPO) of RBL Bank was subscribed 3.08 times with investors bidding for 11.68 crore shares of the total 3.79 crore shares on offer. RBL Bank aims to raise R1,212.97 crore (when calculated at the upper end of the price band) in the price band R224-R225 per share. The IPO comprises a fresh issue equity shares aggregating R832.50 crore and an offer for sale (OFS) of over 1.69 crore shares by Beacon India private equity fund, GPE India and other shareholders.

Qualified institutional buyers (QIBs) bid 4.28 times of their quota or 4.64 crore shares of the 1.08 crore shares reserved for them. High net-worth individuals (HNIs) bid for 87.26 lakh shares of the 81 lakh shares reserved for them, 1.08 times the quota. Retail investors bid for nearly 3.26 times of their quota or 6.16 crore shares of the 1.89 crore shares reserved for them.

On August 18, the bank raised R363.89 crore by allotting 1.61 crore shares to 25 anchor investors at a price of R225 apiece. Among the investors who were allotted shares in the pre IPO placement include Goldman Sachs India Fund, HSBC Global Investment Funds, Reliance Capital Trustee, HDFC Trustee Company, SBI Mutual Fund and Birla Sun Life Trustee Company among others.

In a pre-IPO placement held on December 16, 2015, RBL Bank allotted 2.5 crore shares at a price of R195 per share to investors, amounting to R487.5 crore. CDC Group, Asian Development Bank, DVI Fund (Mauritius) were among these investors.

For the year to March 2016, RBL’s total income grew by 37% year-on-year and net profit was up by 41.19%. RBL ended FY16 with advances of R21,229 crore, up 46% and deposits of R24,348.6 crore, up 42.4%. The bank’s provisions grew by 90% during the same period. As of March 2016, gross non performing assets of the bank were 0.98 of its total advances.

RBL Bank was incorporated as a small, regional bank in Maharashtra in 1943 with two branches in Kolhapur and Sangli. The bank offers a range of banking products and services customised to cater to the needs of large corporations, small and medium enterprises (“SMEs”), agricultural customers, retail customers and development banking and financial inclusion (low income) customers. As part of its growth strategy, RBL acquired certain Indian businesses of the Royal Bank of Scotland in fiscal 2014. As of March 2016, the bank has 197 branches and 362 ATMs spread across 16 Indian states and union territories. The bank proposes to use the net proceeds of the issue for its future capital requirements.

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