Suryoday Small Finance Bank Limited IPO
Incorporated in 2008, Suryoday Small Finance Bank Limited is one of the leading small finance banks in India as per the return on assets, yields, net interest margins, and deposit growth. As per the CRISIL report, it had the lowest cost-to-income ratio in FY 2020. The bank has served for over a decade to its customers in the unbanked and underbanked segments.
The company has diversified its loan portfolio by reducing its dependence on the micro banking business and including non-micro banking loans.
As of 31st July 2020, Suryoday Small Finance Bank has expanded its operations across 12 states & UTs since its inception. The bank has a customer base of 14.3 lakhs and an employee base of 3,949 employees. It is operating 482 banking outlets which include 137 Unbanked Rural Centres. Their diversified distribution network comprises their phone banking, ATMs, tablet banking, Unified Payment Interface(UPI), mobile banking, and internet banking services.
Deposits have shown a growth of a CAGR of 94.95% from ₹ 749.52 crores as of 31st March 2018 to ₹ 2,848.71 crores as of 31st March 2018. As of 31st March 2020, retail deposits were 54.44% of total deposits. Gross Loan Portfolio has shown a growth of CAGR of 46.98% from ₹ 1,717.78 crores as of 31st March 2018 to ₹ 3,710.84 crores as of 31st March 2020.
The promoters of the company are Mr. Baskar Babu Ramachandran, Mr. P. Surendra Pai, Mr. P. S. Jagdish, and Mr. G. V. Alankara.
Strengths of the company
- The company follows a customer-centric approach and focuses on financial inclusion.
- It has a diversified portfolio of assets with a focus on retail banking operations.
- The company is a fast-evolving granular deposit franchise.
- The company has been using emerging technologies for enhancing their digital footprint.
- The company has strong credit processes along with a robust risk management framework.
- It has a strong track record of financial performance & cost-efficient operations.
- The Bank has multiple distribution channels.
- The company has a strong corporate governance and experienced leadership team.
Purpose of the IPO
- To use the funds for augmenting the Bank’s Tier - 1 capital base to meet the future capital requirements.
- To get the listing benefits of the equity shares on the stock exchange.
Financial Performance of the company
| For the six-month period ended 30th September 2020 | FY 2020 | FY 2019 | FY 2018 | |
| Total Revenue | 461.94 | 854.13 | 597.02 | 324.92 |
| Total Expenses | 408.12 | 742.94 | 506.63 | 313.43 |
| Profit After Tax | 258.65 | 111.19 | 90.39 | 11.49 |
| Total Assets | 6,083.53 | 5,364.52 | 3,761.20 | 2,155.96 |
*All the values are in crores
*FY18, FY19 & FY 20 as per DRHP and HY21 as per the quarterly report.
Valuation of the Company
| For the six-month period ended 30th September 2020 | FY 2020 | FY 2019 | FY 2018 | |
| Basic Earnings per Share (EPS) | 6.09 | 13.41 | 13.35 | 1.76 |
| Diluted Earnings per Share (EPS) | 5.95 | 13.30 | 13.16 | 1.76 |
| Return on Net Worth (%) | - | 10.43% | 10.27% | 2.13% |
| Net Assets Value per Equity share | - | 123.13 | 107.91 | 79.78 |
*FY18, FY19 & FY 20 as per DRHP and HY21 as per the quarterly report.
IPO details
| Face Value | ₹10 per equity share |
| Market Lot | 49 Shares |
| Minimum Order Quantity | 49 Shares |
| Price Band | ₹303 - ₹305 per equity share |
| Issue type | Book Built Issue IPO |
| Issue Size | ₹582.34 Crores |
| Fresh Issue | ₹248.58 Crores |
| Offer for Sale | ₹333.76 Crores |
| Listing | NSE, BSE |
Important IPO dates
| Open Date | 17th March 2021 |
| Close Date | 19th March 2021 |
| Basis of Allotment Date | 24th March 2021 |
| Initiation of Refunds | 24th March 2021 |
| The credit of shares to Demat Account | 25th March 2021 |
| Listing Date | 26th March 2021 |
Allocation Quota
| Category | Portion |
| Qualified Institutional Buyers (QIBs) | Not more than 50% |
| Non- Institutional Buyers (NIIs) | Not less than 15% |
| Retail Investors | Not less than 35% |
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