FedFina IPO: Federal Bank's subsidiary files IPO papers with SEBI

Federal Bank subsidiary Fedbank Financial Services Limited (FedFina) has filed the draft red herring prospectus (DRHP) for its initial public offering (IPO) with markets regulator Securities and Exchange Board of India (SEBI).

The IPO includes a fresh issue aggregating up to Rs 900 crore and an offer for sale (OFS) of up to 45,714,286 equity shares by the company's promoter and investor, according to the DRHP.

The OFS consists of up to 16,497,973 equity shares by Federal Bank and up to 29,216,313 equity shares by True North Fund VI LLP, the company said in a regulatory filing on Saturday.

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Federal Bank will continue to own over 51 per cent of the outstanding share capital after the conclusion of its offering.

The company proposes to utilise the net proceeds from the fresh issue towards augmenting its Tier - I capital base to meet its future capital requirements arising out of the growth of business and assets. 

FedFina is a retail-focused NBFC and operates a "twin-engine" business model, with two complementary products -- gold loans and instalment loans to MSMEs and emerging self-employed individuals. 

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The company believes that its long operating history, track record, management expertise and the Federal Bank brand have enabled it to establish a competitive position in the market. 

ICICI Securities, Equirus Capital, IIFL Securities and JM Financial are the book running lead managers to the issue.