Ujjivan Financial Services plans to open its IPO on 28 April 2016. According to the red herring prospectus (RHP), Ujjivan IPO will remain open till 2 May 2016. The INR870 crore IPO will be managed by Kotak Mahindra Capital Company Limited, Axis Capital Limited, ICICI Securities Limited and IIFL Holdings Limited while Karvy Computershare Private Limited will be the registrar.
Through the IPO, Bengaluru-based microfinance lender plans to raise INR358.2 crore by issuing new shares. This is less than the INR650 crore Ujjivan indicated in its draft red herring prospectus (DRHP). The reduction is primarily on account of a pre-IPO placement worth INR291.8 crore in February 2016. Going by the amount raised and shares sold, transaction price turns out to be INR205 per share. This price range is likely to act as a base for the IPO price band.
IFC, FMO, India Financial Inclusion Fund to sell shares
In addition to fresh shares, an offer for sale (OFS) will result in sale of 24,968,332 shares by existing shareholders which includes Sequoia Capital, CX Partners, International Finance Corporation (IFC) and UK’s development finance institution CDC. CDC is the biggest shareholder in Ujjivan with 10.8%, while IFC and CX Partners own 10.08% and 10.66%, respectively.
The OFS will include 3,495,626 shares by Elevar Equity Mauritius; 3,060,722 shares by International Finance Corporation; 1,754,386 shares by India Financial Inclusion Fund; 2,523,725 shares by Mauritius Unitius Corporation; 2,698,163 shares by Nederlandse Financierings-Maatschappij Voor Ontwikkelingslanden N.V. (FMO); 2,935,213 shares by Sarva Capital LLC; 3,093,869 shares by WCP Holdings III; and 5,406,628 shares by Women’s World Banking Capital Partners, L.P.
Ujjivan was one of the 10 companies which last year won in-principle approval from the Reserve Bank of India (RBI) to set up small finance bank (SFB). According to guidelines for SFBs, Ujjivan needs to bring down foreign shareholding to 49% by 6 April 2017. Currently, 77.1% equity of Ujjivan is with foreign shareholders.
For FY2015, Ujjivan’s net profit rose 38% from INR55 crore to INR75 crore and it disbursed loans worth INR432.8 crore with repayment rate of around 99.8%. Ujjivan IPO will compete with Thyrocare Technologies whose IPO opens on 27 April