SBFC Finance IPO: Latest GMP, price band, risks, and other key details
- SBFC Finance IPO subscription begins on August 3 and ends on August 7. The IPO's price band has been set by the company at ₹54 to ₹57 per equity share.
SBFC Finance Ltd initial public offering (IPO) opens for subscription on Thursday, August 3. SBFC Finance specialises in providing loans to entrepreneurs, self-employed people, small business owners, and salaried people. The company generated sales of ₹525 for the nine months ending in December. During that time, the company made profit of ₹107.
It has 137 branches spread throughout 105 locations, and as of December 2022, it had 94,997 customers, up from 40,432 in FY20.
SBFC Finance IPO's floor price is 5.4 times the face value of the equity share and the cap price is 5.7 times the face value of the equity shares. The price to earning ratio for fiscal 2023 based on diluted EPS at the floor price is 33.33 times at the cap price is 35.19 times.
In March, SBFC Finance refiled its IPO papers with capital market regulator Securities and Exchange Board of India (SEBI), where they reduced the IPO size to ₹1,200 crore from ₹1,600 crore earlier.
Here are the 10 key things to know about SBFC Finance IPO:
SBFC Finance IPO dates: SBFC Finance IPO opens for subscription on Thursday, August 3, and closes on Monday, August 7.
SBFC Finance IPO price band: The company has fixed the price band at ₹54 to ₹57 per equity share for the proposed initial public offer.
SBFC Finance IPO lot size: Bids can be made for a minimum of 260 equity shares and in multiples of 260 equity shares thereafter.
Anchor Investors: The allocation to anchor investors for SBFC Finance IPO is scheduled to take place on Tuesday, August 2.
SBFC Finance IPO details: SBFC Finance IPO comprises of fresh issuance of equity shares worth ₹600 crore and an offer for sale (OFS) of ₹425 crore, according to the Red Herring Prospectus (RHP). The total offer size of SBFC Finance IPO now is ₹1,025 crore.
SBFC Finance IPO Objectives: According to RHP, SBFC Finance intends to use the net proceeds to meet future capital requirements that are anticipated to result from the expansion of their company's operations and assets.
Allotment and Listing of SBFC Finance IPO details: SBFC Finance IPO's basis of allotment of shares will be finalised on Thursday, August 10 and the company will initiate refunds on Friday, August 11, while the shares will be credited to the demat account of allottees on Monday, 14 August. SBFC Finance IPO shares are likely to be listed on BSE and NSE on Wednesday, August 16.
Lead Manager and Registrar of SBFC Finance IPO: The book-running lead managers (BRLM) for the SBFC IPO offer are ICICI Securities, Axis Capital, and Kotak Mahindra Capital Company, while KFin Technologies is the registrar.
SBFC Finance IPO GMP: SBFC Finance IPO GMP or grey market premium is +40. This indicates SBFC Finance share price were trading at a premium of ₹40 in the grey market on Tuesday, according to topsharebrokers.com.
Considering the upper end of the IPO price band and the current premium in the grey market, the estimated listing price of SBFC Finance share price is ₹97 apiece, which is 70.18% higher than the IPO price.
'Grey market premium' indicates investors' readiness to pay more than the issue price.
Few Key Risks: One of the risks emphasised by SBFC Finance in their RHP is the risk that non-payment or default by their borrowers may negatively influence their operations, financial situation, and business.
Additionally, SBFC Finance noted in its RHP that it relies on the accuracy and completeness of the data supplied by its clients and a select group of outside service providers. Its evaluation of their creditworthiness, as well as the value and title of the collateral, may be impacted if it relied on any false or deceptive information.
Another risk that can have an adverse effect on the company's operations, earnings, and financial condition was raised by SBFC Finance's inability to evaluate and recover the full value of collateral or amounts owing under defaulted loans in a timely manner or at all.
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