The Equitas Small Finance Bank IPO (initial public offering) is set to open on 20 October. The issue will close on 22 October and is aimed at raising up to Rs 518 crore.
The IPO will comprise of a fresh issue of shares worth Rs 280 crore and an offer for sale (OFS) of 7,20,00,000 shares by the parent company (Equitas Holdings Limited). If the IPO sails through Equitas Holdings Limited's stake in Equitas Small Finance Bank will fall from 95 percent to 82 percent.
The Equitas Holdings Limited IPO was deferred from its earlier plans to open for bidding in March due to coronavirus led decline in stock markets. The issue size has been nearly halved from Rs 1,000 crore.
"The size was reduced by around half as we are reasonably comfortable on our capital adequacy ratio and given the current (market) circumstances," said PN Vasudevan, MD & CEO of Equitas Holdings to reporters.
The price band for the IPO is fixed at Rs 32-33 per share.
Shares worth up to Rs 51 crore will be reserved for the subscription for eligible shareholders on a proportionate basis. A reservation of shares worth up to Rs 1 crore will be made for eligible employees.
Qualified Institutional Buyers (QIB) will get to bid for 50 percent of the offer, retail investors will bid for 35 percent, while 15 percent quota is retained for Non-institutional Investors (NII).
Those participating in the issue will have to place bids for a minimum of 450 equity shares and in multiples of 450 equity shares thereafter.
Objective of the IPO
The objective of the fresh issue is to augment the bank's tier-I capital base to meet their future capital requirements such as organics growth and expansion.