KOCHI: ESAF Small Finance Bank Ltd, the Thrissur-headquartered small finance bank, has received the approval from the Securities and Exchange Board of India (SEBI) to raise funds through an initial public offering (IPO), making it among a half a dozen Kerala-based firms to hit the capital markets in the coming 12-18 months.
ESAF's IPO includes a fresh issue up to Rs 486.74 crore and an offer for sale of up to Rs 142.30 crore by promoters and other selling shareholders. The offer for sale comprises up to Rs 119.26 crore by ESAF Financial Holdings Pvt Ltd, up to Rs 12.67 crore by PNB MetLife India Insurance Company Ltd, up to Rs 10.37 crore by Bajaj Allianz Life Insurance Company Ltd.
The company had refiled preliminary IPO papers with Sebi in July 2023.
This is the third time that ESAF is trying to hit the capital markets with an IPO. The small finance bank first received the Sebi nod in March 2020, but at that time the size of the issue was higher at Rs 976 crore issue including Rs 800 crore primary issuance.
A press release here said the company, in consultation with the lead bankers to the issue, may consider a further issue of equity shares by a private placement or any other method aggregating up to Rs 97.33 crore (Pre-IPO Placement). If such placement is completed, the fresh issue size will be reduced.
Some of the other Kerala-based companies that are planning IPO include Popular Vehicles and Services Ltd., which plans to raise Rs 250 crore through a fresh issue of shares and an offer for sale of about 1.43 crore shares. Popular Vehicles filed its draft red-herring prospectus on October 4. Likewise, Fedbank Financial Services (FedFina), the NBFC arm of Federal Bank, is planning to raise Rs 1,400 crore through an IPO. The IPO is likely to hit the market before the end of this financial year.
Another Kerala company which is planning an IPO is Asirvad Micro Finance Ltd (AMFL), a subsidiary of Manappuram Finance Ltd. In a filing with stock exchanges on October 5, Manappuram Finance said AMFL has filed the DRHP for Rs 1,500 crore IPO. Muthoot Microfin is another Kerala-based company which is aiming to hit the primary markets in the next 18 months or so. Investment bankers said the company is planning to collect Rs 1,000 crore through the IPO.