Tamilnad Mercantile Bank’s Rs 800-cr IPO to launch on Sept 5. Details on price band, lot size here

Private sector lender Tamilnad Mercantile Bank Ltd’s much-awaited initial public offering (IPO) will be opened for investors next week. The issue will open on September 5 and will end on September 7. The price band of the Rs 831 crore IPO has been fixed at Rs 500 to Rs 525 and the lot size is 28 shares and in its multiples thereof. Axis Capital, Motilal Oswal, and SBI Capital Markets are the book-running lead managers for the offer, while Link Intime India is the registrar. The shares are likely to be listed on BSE and NSE on September 15, 2022.

The Thoothukudi-based bank is one of the oldest private sector banks, which was set up almost 100 years ago, and caters to Micro, Small, and Medium Enterprises (MSMEs), agricultural and retail customers.

Booking details

The IPO is a fresh issue and will offer up to 1,58,40,000 equity shares with a face value of Rs 10 each, which takes the total to Rs 831.6 crore. On September 2, the investors can start with anchor book bidding. The investors, who would succeed in the bidding process, will get the shares on their dematerialised accounts (demat accounts) on September 14. The stock will make its market debut on September 15.

According to the details, 75 per cent, or three-fourth of the offer, will be kept aside for Qualified Institutional Investors (QIBs), 15 per cent for Non-Institutional Investors (NIIs), and the remaining 10 per cent will be marked for the retail investors.

As per the deal details, a retail investor can apply for a minimum of 1 to a maximum of 13 lots. The investment limit for a retail investor has been kept between a minimum of Rs 14,700 and a maximum of Rs 1,91,100.

Bank at a glance

The private lender has an active customer base of 50.8 lakh, mostly in Tamil Nadu. As per the bank statistics, 85 per cent of customers, or around 41.8 lakh, are in Tamil Nadu itself, as of March 31, 2022. The bank has a significant presence in states, such as Gujarat, Maharashtra, Karnataka, Andhra Pradesh and Delhi. The lender had 509 branches, with 106 located in rural areas, 247 in semi-urban locations, 80 in urban and 76 in metropolitan centres as of March 31, 2022. Of which, 369 branches are in Tamil Nadu

During the fiscal year 2022, the lender’s current account and savings account (CASA) deposits stood at 30.50 per cent. Its net profits increased at a CAGR of 41.99 per cent during fiscal 2020-22, with the bank reported a net profit of Rs 820 crore in fiscal 2022. It has reported deposits of Rs 44,930 crore and advances of Rs 33,490 crore, as of March 2022.
It provides a wide range of services to its customers, such as ATMs, CRMs, internet banking, mobile banking, E-Lobbies, point of sales (PoS), banking, and debit and credit cards. It forayed into internet banking in 2008 through ‘TMB-Econnect’ and a utility payment facility so that customers can pay their basic bills.