Ujjivan Financial IPO to open on April 28

The initial public offer of Bengaluru-based microfinance institution Ujjivan Financial Services Ltd will hit the primary market from April 28-May 2 to raise ₹875-882 crore. This constitutes a fresh issue of ₹358.16 crore and the rest from an offer-for-sale of over 2.49 crore equity shares by existing shareholders.

The shares will be priced at ₹207-210 apiece for a face value of ₹10. The bid lot is 70 shares and multiples of 70.

Strengthening capital base The proceeds of the fresh issue will be used to augment the lending company’s capital base. One of the conditions for microfinance institutions receiving the RBI’s in-principle approval to convert into a small finance bank is to reduce foreign shareholding to under 49 per cent. Through this IPO, Ujjivan will reduce its foreign shareholding from the current 77 per cent to 44-45 per cent, with partial and full exits by several foreign investors, including International Finance Corporation, Elevar Equity Mauritius, Sarva Capital and Mauritius Unitus Corporation.

The company raised ₹291.83 crore in a pre-IPO placement round with institutional investors, selling over 1.42 crore shares at ₹205 apiece.

With assets under management of ₹4,600 crore, Ujjivan hopes to make its transition into a bank in the first quarter of 2017, the company’s management said at a press conference here.

Kotak Investment Banking, Axis Capital, ICICI Securities and IIFL are the book-running lead managers to the issue. The shares will be listed on the BSE and NSE.

Equitas soars on debut Meanwhile, the shares of Equitas Holdings, the first among the microfinance companies to go public after receiving the RBI’s small finance bank licence, gained 23.36 per cent on the NSE on Thursday — the first day of its listing. The stock closed at ₹135.20. The company raised ₹2,176 crore from the primary market earlier this month at an issue price of ₹110.