Ujjivan Small Finance Bank IPO oversubscribed on Day 1, strong demand from retail investors

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Updated: December 2, 2019 5:12:52 PM

Ujjivan SFB, UFSL, Retail individual bidders, NBFC, IPO, Ujjivan SFB newsFollowing the IPO, the promoter holding in the bank, which currently stands at 100%, would come down to around 85%, said Samit Kumar Ghosh, managing director and CEO, Ujjivan SFB.

Ujjivan Small Finance Bank IPO to raise up to Rs 750 crore got fully subscribed on first day, backed by strong demand from retail investors. The issue received bids for 19.13 crore shares, as against the issue size of 12.39 crore shares, totalling to a subscription of 1.56 times, data from NSE showed. Retail investors bid for a total of 15.78 crore shares as against their issue size of 1.87 crore shares, implying a demand of 8.25 times. The reserved shareholders had bid for 25% of their allotted portion, while HNI’s had put in bids for 40% of the portion reserved for them. The QIBs bid for a total of 23% of their reserved portion.

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Ujjivan SFB IPO will remain open till 4th December, Wednesday. For the public offer, Ujjivan Small Finance Bank has set a price band of Rs 36-37 per share. The proceeds from the issue will be utilised increasing Tier-1 capital base to meet future capital requirements and towards meeting the expenses in relation to the issue. Ujjivan Small Finance Bank’s parent firm Ujjivan Financial Services was listed in 2016. The public float of Ujjivan Small Finance Bank’s IPO is being carried out with the objective of listing within three years of getting a banking licence, to be compliant with the regulations.

The minimum bid lot for the IPO has been fixed at 400 shares and in multiples of 400 shares thereafter. According to timeline shared by various brokerages the allotment is likely to be finalised by 9th of December while the listing on the exchanges is likely to be complete by the 12th of December. Ujjivan Small Finance Bank is a mass market focused bank catering to the financially underserved segments. It serves over 49 lakh customers across 24 states and union territories, according to a report by HEM Securities.  “At the IPO price band of Rs 36-37, the stock is available at a P/BV (price to book value) of around 2.2 times (post issue) at the upper band on April-September FY20 basis,”ICICI Direct said in its report, while giving a subscribe rating.

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