Fino Payments Bank’s initial public offering (IPO) was fully subscribed within hours of its launch

Fino Payments Bank’s initial public offering (IPO) was fully subscribed within hours of its launch

The subscription period for Fino Payments Bank’s 1,200-crore initial public offering (IPO) begin on Friday, and the three-day share sale will end on November 2. A price range of 560-577 per share has been set by the firm. Fino Payments announced on Thursday that it has raised $539 crore from anchor investors ahead of its first public offering.

According to BSE data, the Fino Payments Bank IPO has been subscribed 0.33 times as of 12:45 p.m. on day 1, with the retail component fully booked at 1.79 times. Qualified institutional buyers (QIBs) have yet to bid, while non-institutional investors (NIIs) have bid 0.01 times.

A fresh issue of equity shares worth 300 crore and an offer for sale (OFS) of 15,602,999 equity shares by the promoter Fino Paytech are included in the share sale.

Fino Payments Bank’s overall revenues grew at a 46.0 percent compound annual growth rate (CAGR) from FY2019 to FY2021, and the company has turned around its operations, reporting profits of Rs. 20 crore for the first time in FY2021. The company would be selling at a P/E of 220x FY2021 fully diluted EPS of Rs. 2.6 at the highest end of the price band, which is costly. Despite the IPO’s high growth potential, the believe is that the premium is not justified, and hence we have a NEUTRAL recommendation.

The proceeds from the new offering will be utilised to boost the bank’s Tier 1 capital base in order to meet its future capital needs. The issue’s book running lead managers are Axis Capital, CLSA India, ICICI Securities, and Nomura Financial Advisory Services.

“With a presence in over 90% of India’s districts, the company has a significant opportunity to grow its business in the next years. This IPO has a “Subscribe-Long Term” grade from us “In an IPO note, stockbroker Anand Rathi stated.

Fino Payments Bank, or FPBL, is a scheduled commercial bank that provides digital-based financial services to the developing India market. The company will be the first payments bank to go public on stock exchanges.

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