Utkarsh Small Finance Bank (USFB) is set to get an IPO to raise 1350 funds from the primary market. The USFB has submitted an application with the market regulator SEBI to launch the IPO. In its draft Red Herring Prospectus (DRHP), the USFB has said that it will issue a fresh share of Rs 750 crore for the IPO. At the same time, the promoter company of USFB Utkarsh Coreinvest Ltd will issue equity shares worth Rs 600 crore through Offer for Sale (OFS).
Utkarsh Small Finance Bank said that the company is also considering a pre-IPO placement of Rs 250 crore in consultation with its investment bankers. For this IPO, Utkarsh Small Finance Bank has appointed ICICI Securities, IIFL securities, Kotak Investment Bank as its lead manager.
The company will use the funds raised through this IPO to strengthen its capital base in Tier-1 cities and to meet future capital requirements. The Capital to Risk Assets Ratio (CRAR) of the company as on September 2020 was 24.87% with Tier-I CRAR of 19.02%.
Special things about the company
Utkarsh Small Finance Bank’s total income stood at Rs 1,406.24 crore in FY2020, compared to only Rs 958.25 crore in the previous year. At the same time, the company had a net profit of Rs 186.74 crore in FY20 which was Rs 110.87 crore in FY19. Apart from this, the provision of the bank stood at Rs 163.55 crore this financial year. According to global rating agency CRISIL, Utkarsh Small Finance Bank is the most profitable small finance bank among SFBs. Also in terms of Return on Assets (ROA), it also topped last financial year.
The bank’s total deposits stood at Rs 5,969.30 crore as of September quarter, while the bank disbursed a total loan of Rs 6,606.58 crore. The Utkarsh Small Finance Bank NPA is 0.64% and the provision coverage ratio is 101.99%. The bank operates in 18 states and UTs and has 528 banking outlets. This SFB employs 8,729 employees.
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