Home >market >stock-market-news >RBL Bank set to file for IPO within a week, looks to raise Rs1,450 crore

Mumbai: RBL Bank Ltd, a privately held lender backed by a clutch of private equity funds, is set to file its draft red herring prospectus (DRHP) with the markets regulator within a week, said three people familiar with the development.

“The bank is looking to raise 1,450 through its initial public offering (IPO), of which 1,100 crore will be raised to increase the capital adequacy ratio of the bank and the rest to give exit to a few private equity funds," said the first investment banker mentioned above.

The bank has hired around nine investment banks to run the process. The IPO would help the bank comply with the Reserve Bank of India (RBI) guidelines issued last year that directed all banks to list within three years of starting business.

The company spokesperson declined to comment.

Over the last three years, global and local private equity and development funds have invested over 1,400 crore in the bank in three tranches. Housing Development Finance Corp. Ltd (HDFC), Norwest Venture Partners, Samara Capital, Beacon Capital, Faering Capital, TVS Shriram, Cartica Capital, Ascent Capital, Aditya Birla Private Equity, IDFC’s Spice Fund and ICICI’s Emerging India Fund are among its shareholders.

RBL raised 328 crore by selling fresh shares to UK government-owned development institution CDC Group Plc and Asia Capital and Advisors Pte Ltd along with existing shareholders International Finance Corp. and Gaja Capital.

Though RBL is an old private sector bank established in 1943, it has accelerated its growth under a new management, led by managing director and chief executive officer Vishwavir Ahuja since 2010. In the last three years, the bank has shed its regional image, opened branches and attracted new investors.

The share sale will make RBL the 41st publicly traded bank in India.

The bank’s net total income surged 59% to 960 crore in fiscal year 2015 from 603 crore in fiscal year 2014. The surge in income is without accounting for the one-off charge in FY14 that it paid towards the premium for acquisition of certain businesses from Royal Bank of Scotland in India. The increase in net profit for FY15 is 56%. Net profit for the year stood at 207 crore, an increase of 124% over the previous year, it said in a press statement released in May this year.

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