Fedbank Financial IPO to open on Nov 22 at price band of Rs 133 to Rs 140

Fedbank Financial Services, a Non-Banking Financial Company (NBFC), will open its initial public offering (IPO) of equity shares on November 22, 2023, and close on November 24, 2023. The price band has been fixed at Rs 133 to Rs 140 per equity share with a face value of Rs 10 each. The company aims to raise around Rs 1,092 crore from the IPO.

The IPO comprises a fresh issue of equity shares aggregating up to Rs 600 crore and an offer for sale of up to Rs 492 crore. The floor price is 13.30 times, and the cap price is 14 times the face value of the shares. The Anchor Investor Bidding will start on November 21, 2023.

Fedbank Financial Services provides loans to MSMEs and emerging self-employed individuals. It has a presence across 17 states and Indian territories, covering 190 districts through its 584 branches.

The company’s key business lines include mortgage loans, gold loans, and unsecured loans. Regarding the impact of the Reserve Bank of India’s (RBI) recent circular on NBFCs, the management stated that they are not unduly worried about the decision, as nearly 86-87 per cent of the company’s loan book is in the secured category. Furthermore, the company primarily focuses on MSME business loans rather than retail personal loans.

The IPO, set to open on November 22, 2023, and close on November 24, 2023, has fixed a price band at Rs 133 to Rs 140 per equity share, each with a face value of Rs 10.

The NBFC's profitability has increased to Rs 180 crore as of March 2023, up from Rs 62 crore as of March 2021. Similarly, the Assets Under Management (AUM) of the company has also risen from Rs 4,800 crore in March 2021 to Rs 9,100 crore in March 2023.

Speaking on the financial metrics, Anil Kothuri, MD & CEO of Fedbank Financial Services, said, 'Our asset liability management has the advantage that the gold loan portfolio is an extremely short-tenure portfolio. Consequently, the tenure of our borrowing is far longer than the maturity of our assets. Our Asset and Liability Management (ALM) is positive from the first bucket itself. We have a diversified set of lenders. Every private and public sector bank lends to us, and they have deep lines on Fedfina that we can avail of. All these advantages have translated into a reasonable set of financial metrics for the company.'

The proceeds from the funds will be used to meet the company's future capital requirements arising from growth in its business and assets. Additionally, a portion of the proceeds will be used to cover offer expenses.

The offer for sale includes nearly 54 lakh equity shares by the Federal Bank and up to 2.96 crore by True North Fund LLP.

ICICI Securities, BNP Paribas, Equirus Capital, and JM Financial are the book running lead managers for the issue.

The firm has reserved Rs 10 crore worth of shares in the IPO for its employees, who will receive these shares at a discount of Rs 10 per share to the final offer price.

Of the total net offer size, 50 per cent has been reserved for qualified institutional buyers (QIBs), 15 per cent for high net-worth individuals, and the remaining 35 per cent for retail investors.

Investors can bid for a minimum of 107 equity shares and in multiples of 107 shares thereafter.

Post-listing, Federal Bank will hold about 61 per cent of the company, True North will have about 8.5 per cent, and approximately 31 per cent will belong to new shareholders who join after the IPO.

Pen maker Flair Writing Industries Ltd has set a price band of Rs 288-304 a share for its Rs 593-crore initial public offering (IPO), market sources said on Friday.
 

The maiden public issue will open for subscription on November 22 and conclude on November 24 and the anchor book of the offer will be opened for a day on November 21, they added. The IPO comprises a fresh issue of equity shares aggregating up to Rs 292 crore and an offer-for-sale of equity shares worth up to Rs 301 crore by promoters and promoter group entities. At present, promoters and promoter group entities own 100 per cent stake in the company. Proceeds of the fresh issue will be used for setting up a manufacturing facility for writing instruments at Valsad district in Gujarat; funding the company's capital expenditure and subsidiary Flair Writing Equipments Pvt Ltd (FWEPL).
 

Besides, the proceeds will be used to support the working capital requirements of the company and subsidiaries FWEPL and Flair Cyrosil Industries. Aslo, the money will be used for payment of the loan and general corporate purposes.

Half of the issue size has been reserved for qualified institutional buyers, 35 per cent for retail investors and the remaining 15 per cent for non-institutional investors. (Source: PTI)

Gandhar Oil Refinery (India) Ltd on Friday fixed the price band for its Rs 500.69-crore initial public offering (IPO) at Rs 160-169 per share. The maiden public issue will open for subscription on November 22 and end on November 24, the company said.
 

The anchor book of the offer will be opened for a day on November 21. Investors can bid for a minimum of 88 equity shares and in multiples of 88 thereafter.
 

This will be the third maiden public issue opening next week, after Indian Renewable Energy Development Agency and Tata Technologies. 
 

The IPO comprises afresh issue of equity shares worth Rs 302 crore and an Offer for Sale (OFS) of 1.17 crore by promoters and existing shareholders.
 

Those offering shares in the OFS include promoters -- Ramesh Babulal Parekh, Kailash Parekh and Gulab Parekh -- and other shareholders, Fleet Line Shipping Services LLC, Denver Bldg Mat & Décor TR LLC, and Green Desert Real Estate Brokers.

The company will fetch up to Rs 500.69 crore at the upper end of the price band.
 

Proceeds from the fresh issue component will be used for payment of debt and for the purchase of equipment and civil work required for expansion in the capacity of automotive oil at the Silvassa plant.
 

In addition, the funds will be utilised for expansion in capacity of petroleum jelly and accompanying cosmetic product division at the company's Taloja plant as well as expansion in capacity of white oils by installing blending tanks at the plant and funding working capital requirements. (Source: PTI)