India: ESAF Small Finance Bank to file papers for IPO

Photo: Bloomberg

Kerala-based ESAF Small Finance Bank (SFB) is set to file a draft prospectus by December-end for a 1,000 crore initial public offering (IPO), two people aware of the matter said, requesting anonymity.

In 2015, ESAF Microfinance and Investments was one of the 10 lenders to receive an in-principle nod from the Reserve Bank of India (RBI) to set up a small finance bank.

“The bank is likely to file its draft prospectus with Sebi (Securities and Exchange Board of India) this month. It plans to raise 1,000 crore through the IPO, which will be a mix of primary and secondary share sale,” said one of the persons mentioned above, requesting anonymity as he is not authorized to speak with the media. “The company could also raise part of the proceeds through a pre-IPO funding round of around 200 crore,” he said.

E-mailed queries sent to ESAF SFB, Edelweiss, and Axis Capital remained unanswered, while IIFL Securities and ICICI Securities chose not to comment.

ESAF’s plans to go public follows the stellar IPO of Ujjivan SFB earlier in December, which saw a subscription of more than 165 times—the highest among all IPOs in 2019. Another SFB, Equitas Small Finance Bank, has also filed its draft prospectus with the market regulator on 16 December for a 1,000 crore IPO.

Besides Ujjivan SFB, Jaipur-based AU Small Finance Bank Ltd is the only other listed public small finance bank. AU SFB went public in 2017. Other SFBs that have started work on their IPOs include Fincare SFB and Utkarsh SFB, which aims to hire investment banks to advise on its 500 crore initial share sale, Mint reported on 18 September.

Between April-September 2019, ESAF SFB’s total income rose 37% from the year-earlier to about 728.87 crore. Profit jumped nearly threefold on a year-on-year basis to 92.43 crore during the period. In terms of asset quality, the bank’s gross non-performing assets to total advances stood at 1.76% as of six months ended 30 September, compared to 3.37% in the corresponding period last year. The bank’s capital adequacy ratio stood at 25.69% as of 30 September.

This article was first published on livemint.com

Singapore Reporter/s

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).

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

  • 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.

Singapore Reporter/s

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).

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

  • 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.