ESAF Small Finance Bank shares list at 20% premium over IPO price
ESAF Small Finance Bank debuted at a premium of 19.8% on the BSE on Friday. The stock got listed at Rs 71.9 on BSE as against the issue price of Rs 60.
Meanwhile, on NSE, it debuted at Rs 71, a premium of 18.3%.
Ahead of the listing, the company's shares were trading at a premium of Rs 19 in the unlisted market.
The public offer was subscribed by a massive 73 times at close on strong demand from institutional investors. The QIB category of the IPO was booked 173 times.
ESAF Small Finance Bank has a focus on unbanked and under-banked customer segments, especially in rural and semi-urban areas.
The AUM grew from Rs 8,426 crore to Rs 16,320 crore from FY21-23, registering a CAGR of 39.22%, the highest CAGR among peers.
As a small finance bank, ESAF requires at least 75% of its adjusted net bank credit to be allocated to priority sectors. Their business model revolves around responsible banking principles, offering customer-centric products and services through innovative technology applications.
Its asset products include micro loans, retail loans, MSME loans, loans to financial institutions, and agricultural loans.
As of March 2023, 62.84% of the lender's gross advances were directed towards customers in rural and semi-urban areas, and 71.71% of their banking outlets were located in these regions.
The robust demand for the IPO was likely due to strong fundamentals in the company and industry dynamics. «We believe there are a lot of unbanked opportunities in under-banked customer segments, especially in rural and semi-urban centres wherein ESAF SFB has a stronghold in south India,» said Prashant Tapse of Mehta Equities
For the three months ended June, the lender's total income rose 34% year-on-year to Rs 992 crore,
