India: GIC-backed Bandhan Bank files DRHP, eyes IPO in March-April

Bandhan Bank. Photo: Mint

Bandhan Bank Ltd, one of the two entities to receive a universal banking licence in 2015 and the only microfinance institution to do so, on Monday filed its draft initial public offering (IPO) prospectus.

In a statement, the bank said that it will be offering 119.28 million shares in its proposed initial share sale, through a mix of primary and secondary share sale.

“In terms of the RBI New Bank Licensing Guidelines, the Equity Shares of our Bank are required to get listed on the stock exchanges within three years from the date of commencement of business of our Bank, i.e., on or before August 22, 2018,” the bank said in its draft red-herring prospectus (DRHP) filed with the Securities and Exchange Board of India (Sebi).

The IPO consists of a fresh issue of up to 97.6 million shares and an offer for sale of up to 14.05 million shares by International Finance Corp. (IFC) and up to 7.56 million equity shares by IFC FIG Investment Co.

IFC and IFC FIG collectively own 4.94% stake in the bank.

The share sale will see a dilution of around 10% stake.

“The objects of the fresh issue are to augment our bank’s Tier-I capital base to meet our bank’s future capital requirements. Further, the proceeds from the issue will also be used towards meeting the expenses in relation to the issue,” Bandhan Bank said in its DRHP.

Investment banks Kotak Mahindra Capital Co. Ltd, Axis Capital Ltd, Goldman Sachs (India) Securities Pvt. Ltd, JM Financial Institutional Securities Ltd and JP Morgan India Pvt. Ltd are managing the IPO.

Bandhan’s IPO is expected to be one of the largest IPOs this year and is expected to hit the market around March or April.

“The marketing of the IPO will start soon. The deal is on the fast track and the management is looking at a timeline of around March/April for the launch, depending on market volatility,” said a person aware of the bank’s IPO plans, requesting anonymity as he is not authorized to speak with the media.

As of 30 September, Bandhan Bank had 864 bank branches and 386 ATMs, together serving over 1.87 million customers. The bank’s current account and savings account deposits stood at Rs7,170 crore as of 30 September, a CASA ratio of 28.18%.

This article was first published on LiveMint.com

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In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

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  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.