ESAF Small Finance Bank files DRHP escalates INR 998 crore via IPO


ESAF Small Finance Bank has filed the Draft Red Herring Prospectus (DRHP) with the capital market regulator Sebi to escalate funds via an initial public offering.

The company is forecasting to escalate INR 997.78 crore through its public issue which consists of a fresh issue of INR 800 crore and an offer for sale of INR 197.78 crore by existing selling shareholders.

As part of the proposal for sale, a sponsor will be selling INR 150 crore worth of shares, PNB Metlife India Insurance Company will be offloading shares worth INR 21.33 crore, Bajaj Allianz Life Insurance Company INR 17.46 crore, PI Ventures LLP INR 8.73 crore, and John Chakola will be selling shares worth INR 0.26 crore.

The proposal comprises an arrangement of some shares for its employees.

The small finance bank may, in consultation with the book running lead managers, consider a pre-offer placement of INR 300 crore. If the pre-IPO placement is undertaken, then the stated amount will be reduced from the fresh issue.

ESAF will utilize the net proceeds from the fresh issue for supplementing its Tier – I capital base to meet forthcoming capital requirements.

ESAF Small Finance Bank is one of the prominent small finance banks in India in terms of client base size, yield on advances, net interest margin, assets under management CAGR, total deposit CAGR, loan portfolio deliberation in rural and semi-urban areas, and the ratio of microloan advances to gross advances.

Along with sponsors, it has a past of more than 25 years of primarily serving the unserved and underserved, with a focus on financial inclusion. As a small finance bank, it is required to have at least 75 percent of its familiar net bank credit to the priority sectors. Its asset products comprise microloans, retail loans, MSME and corporate loans, and agricultural loans.