State Bank of India (SBI) on Thursday announced the approval for divestment up to 4% in SBI Cards through an initial public offering (IPO).
State Bank of India (SBI) on Thursday announced the approval for divestment up to 4% in SBI Cards through an initial public offering (IPO). However, exact quantum of amount to be raised through IPO is yet to be disclosed.
Headquartered in Gurgaon, SBI Cards and Payment Services Private is a leading credit card issuer in India and is also a non-deposit accepting systemically important non-banking financial company registered with the Reserve Bank of India. “Pursuant to the applicable provision on the Sebi regulation, we advise that the Executive Committee of the Central Board of Directors (ECCB) of the bank at its meeting held today has accorded final approval, for divestment of SBI stake in SBI Cards upto 4% through IPO by way of offer for sale of upto 3,72,93,371 equity shares, subject to the approval of the Securities and Exchange Board of India, or government of India, Reserve Bank of India and/or such other concerned authorities and departments,” SBI said in the exchange notification. The company delivered profit after tax of Rs. 788 crore in FY2019 at YoY growth of 36%.
At present, SBI holds 74% and CA rover Holdings (Group company of Carlyle) holds 26% stake in the company.
SBI’s annual report of 2018-19 stated that during FY2019, the company’s card base has grown by 32% YoY with the total number of credit cards reaching 82.71 lakh as on March 31, 2019. Total spends on cards witnessed a YoY growth of 35% to Rs. 1,07,350 crore for the same period. The company is positioned at Rank 2 with 17.2% spends share and 17.4% cards base as per RBI report for February 2019.