Capital Small Finance Bank files DRHP with Sebi
Capital Small Finance Bank is one of India's top SFBs in terms of asset quality, cost of funds, retail deposits, and CASA deposits for fiscal 2021. (Source: CRISIL Research Report) has submitted its Draft Red Herring Prospectus ("DRHP") to the market regulator Securities and Exchange Board of India ("SEBI").
The company began operations as India's first small finance bank and has the most diversified portfolio with a sizable book in multiple asset classes when compared to other SFBs, with the highest proportion of secured lending at 99% as of Fiscal 2021. (From the CRISIL Research Report.)
The company intends to raise funds through an Initial Public Offering (IPO), which will include a fresh issue of equity shares worth up to Rs. 450 crores ("The Fresh Issue") and an offer to sell up to 3,840,087 equity shares ("The Offer for Sales").
The Offer for Sale includes up to 337,396 equity shares issued by PI Ventures LLP, up to 604,614 equity shares issued by Amicus Capital Private Equity I LLP, up to 70,178 equity shares issued by Amicus Capital Partners India Fund I, and up to 836,728 equity shares issued by Oman India Joint Investment Fund II (the "Investor Selling Shareholders") and up to 1,991,171 equity shares issued by certain persons listed in DRHP (The “Other Selling Shareholders”).
As of Fiscal 2021, the company has the best asset quality among SFBs, with the lowest GNPA and NNPA of 2.08 percent and 1.13 percent, respectively. It has the highest CASA ratio of 40% in Fiscal 2021 when compared to other SFBs and is among the top ten banks when compared to private sector banks. (From the CRISIL Research Report.) As of Fiscal 2021, the company has the highest retail deposits per branch of Rs. 322.50 million. (Source: CRISIL Research Report) and have the lowest funding cost among SFBs as of Fiscal 2021. (From the CRISIL Research Report.)
The company intends to use the net proceeds from the new issue to augment the bank's Tier-I capital base in order to meet the bank's future capital requirements.
The issue's Book Running Lead Managers are Edelweiss Financial Services Limited, Axis Capital Limited, and SBI Capital Markets Limited.
The equity shares are being proposed for listing on the BSE and NSE.