IPO-Bound Utkarsh Small Finance Bank Raises Rs 223 Crore From Anchor Investors

Utkarsh Small Finance Bank on Tuesday said it has mobilised Rs 223 crore from anchor investors ahead of its initial share sale, which opens for public subscription on Wednesday.

The company has decided to allot 8.91 crore equity shares to 20 funds at Rs 25 apiece, which is also the upper end of the price band, according to a circular uploaded on the BSE website.

Goldman Sachs, Massachusetts Institute of Technology Basic Retirement Plan Trust, Aditya Birla Sun Life Mutual Fund (MF), Edelweiss MF, ICICI Prudential MF, and Kotak Mahindra MF are among the anchor investors.

Utkarsh is looking to raise Rs 500 crore through its IPO, which is a completely fresh issue of equity shares. The issue, with a price band of Rs 23-25 a share, will open for public subscription from July 12-14.

Proceeds from the fresh issue will be utilised to augment the lender's tier 1 capital base to meet future capital requirements.

Investors can bid for a minimum of 600 equity shares and in multiples of 600 equity shares thereafter.

Utkarsh commenced operations in 2017 and its product suite includes a range of deposit products, including saving accounts, salary accounts, current accounts, recurring and fixed deposits, and locker facilities.

As of March 2023, the lender's operations were spread across 26 states and union territories with 830 banking outlets serving 3.6 million customers majorly located in rural and semi-urban areas, primarily in Bihar and Uttar Pradesh.

The bank's gross loan portfolio has grown to Rs 13,957.11 crore as of March 31, 2023, from Rs 8,415.66 crore as of March 31, 2021.

Its disbursements increased to Rs 12,442.89 crore in fiscal 2023 over Rs 5,914.01 crore in fiscal 2021. Also, the deposits surged to Rs 13,710.14 crore as against Rs 7,507.57 crore during the period.

Post successful completion of the IPO, Utkarsh would join the league of other small finance banks such as AU Small Finance Bank, Equitas Small Finance Bank,Ujjivan Small Finance Bank, and Suryoday Small Finance Bank to list on the stock exchanges.

ICICI Securities and Kotak Mahindra Capital Company are the book-running lead managers to the issue.