Fedbank Financial Services IPO to open on November 22; key details

The initial public offering (IPO) of Fedbank Financial Services will open for bidding on Wednesday, November 22, as the company is offering its shares in the range of Rs 133-140 apiece, with a lot size of 107 equity shares. The issue will conclude on Thursday, November 24. The anchor book will open on Tuesday, November 21.

Fedbank Financial Services is a subsidiary of The Federal Bank Ltd, which provides gold loans, home Loans, loan against property (LAP) and business loan services. The retail-focused shadow lender has the second lowest cost of borrowing among the MSMEs, gold loan and related peer set in India in financial year 2023.

Fedbank Financial Services is looking to raise Rs 600 crore via fresh issue. Its promoter The Federal Bank and a shareholder True North Fund will together offload up to 3,51,61,723 equity shares via offer-for-sale (OFS) route. At the upper end of the price band, the company is likely to raise Rs 1,092.26 via the IPO route.

The proceeds from the fresh issue will be utilised towards augmenting the company's Tier-I capital base to meet the company's future capital requirements, arising from the growth of the business and assets.

Fedbank Financial Services' clientele mainly consists of MSME and emerging self-employed individuals. It follows a Phygital doorstep model, a combination of digital and physical initiatives, for providing customized services to customers across all the products.

Fedbank Financial Services has offices in 191 districts in 16 states and union territories in India through 575 branches with a strong presence in Southern and Western regions of India including Andhra Pradesh, Telangana and Rajasthan as of March 31, 2023.

Fedbank Financial Services has reserved shares worth Rs 10 crore for its eligible shareholders, who will get a discount of Rs 10 per share during the IPO. A total of 50 per cent of the net offer is reserved for qualified institutional bidders. The quota for non-institutional investors and retail investors are fixed at 15 per cent and 35 per cent, respectively.

ICICI Securities, BNP Paribas, Equirus Capital and JM Financial are the book running lead managers of the IPO of Fedbank Financial Services IPO, while Link Intime India Private Ltd is the registrar for the issue. Shares of the company will be listed on both BSE and NSE.

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