ESAF Small Finance Bank IPO to open on November 3; check key details

ESAF Small Finance Bank has announced the price band for its upcoming initial public offering (IPO) as the company will be selling shares in the range of Rs 57-60 per share with a lot size of 250 equity shares and its multiples thereafter. The issue will open for subscription on Friday, November 3 and can be subscribed till Monday November 7.

The Thrissur-based lender is looking to raise Rs 463 crore via primary markets, which includes a fresh share sale of up 390.70 crore. The issue has an offer-for-sale (OFS) component of Rs 72.30 crore by its promoter ESAF Financial Holdings and other selling shareholders PNB Metlife India Insurance Company and Bajaj Allianz Life Insurance Company.

Kerala-centered ESAF Small Finance Bank, incorporated in 1992, mainly focusing on providing loans to rural and semi-urban customers, providing financial solutions such as micro loans, retail loans, MSME loans, loans to financial institutions, and agricultural loans.

The bank offers convenience banking through various digital platforms such as an internet banking portal, a mobile banking platform, SMS alerts, bill payments and RuPay branded ATM cum debit cards. It had a network of 700 outlets, 743 customer service centers, 20 business correspondents and 481 business facilitators, 581 ATMs located across 21 states of India, as of March 2023.

The net proceeds from the issue shall be utilized towards augmentation of the Bank's Tier-I capital base to meet the Bank's future capital requirements and to ensure compliance with regulatory requirements on capital adequacy prescribed by the RBI, said the company in its DRHP. Anchor book for the issue shall open on Thursday, November 2.

The company has reserved shares worth Rs 12.5 crore for its eligible employees, who will get a discount of Rs 60 per share during the bidding. Of the net offer, 50 per cent shares shall be reserved towards qualified institutional bidders (QIBs) and 15 per cent shares will be allocated to non-institutional investors. Retail investors will have 35 per cent of the net offer allocated for them.

ICICI Securities, DAM Capital Advisors and Nuvama Wealth Management are the book running lead managers to the issue, while Link Intime India has been appointed as the registrar to the issue. Shares of the ESAF Small Finance Bank shall be listed at both BSE and NSE.

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