Fino Payments Bank IPO: The company has fixed a price band of Rs 560-577 per share
According to subscription data from stock exchanges, Fino Payments Bank’s initial public offering (IPO) of Rs 1,200 crore was subscribed 51 per cent on the first day of its issue. The fintech company’s public offering opened for subscription to investors today and will close on November 2.
On Friday, retail individual investors (RIIs) showed more interest as the share reserved for them was subscribed 2.73 times – the highest among the three groups of investors. The portion set aside for Qualified Institutional Buyers or QIBs remained unsubscribed, while the portion reserved for non-institutional investors was subscribed 0.05 times.
Fino Payments Bank has fixed a price band of Rs 560-577 per share for the public offer. A retail-individual investor can apply for 13 lots – 325 shares or up to Rs 187,525. Axis Capital, CLSA India, ICICI Securities and Nomura Financial Advisory are the lead managers to the issue.
The primary market offer will include a fresh issue of Rs 300 crore and an offer for sale of 1,56,02,999 shares by promoter Fino Petek. The company will use the net proceeds from the fresh issuance to raise its Tier-1 capital. Basis for meeting future capital requirements.
“At the high end of the price band, Fino Payments Bank IPO is aggressively valued at 235 times FY2011 earnings (on a post issue basis). However, given its specific situation, the bank may order a stronger valuation. The bank generates over 95 percent of its income through fees and commissions.
Given the company’s strong topline growth, strong outlook due to digital payments opportunity, but bullish valuations, investors who want to invest in the upcoming novel fintech space may consider investing in this issue. However, given the aggressive valuations, the issue may not see higher listing gains,” the SEBI-registered investment advisory said in a report.
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