Capital Small Finance Bank awaiting SEBI nod for IPO, says MD & CEO Sarvjit Singh Samra

Private equity and venture capital-backed Capital Small Finance Bank’s IPO consists of a fresh issue of Rs 450 crore and an offer-for-sale of up to 24.12 lakh shares by its existing shareholders and promoters.

Jalandhar-based Capital Small Finance Bank is expecting approval from the Securities and Exchange Board of India (Sebi) for an IPO consisting of a fresh issue of Rs 450 crore by next month, said Managing Director (MD) and Chief Executive Officer (CEO) Sarvjit Singh Samra, in an exclusive interview with on November 10.

"The documents have been filed with the SEBI and we are expecting to get approval from SEBI by December 2023. In general, typically it takes 80-85 days to grant approval after the date of filing. We had filed this around September 28, "said Samra.

Private equity and venture capital-backed Capital Small Finance Bank’s IPO consists of a fresh issue of Rs 450 crore and an offer-for-sale of up to 24.12 lakh shares by its existing shareholders and promoters.

The OFS comprises 8.37 lakh shares by Oman India Joint Investment Fund II, up to 3.37 lakh shares by PI Ventures LLP, up to 6.05 lakh shares by Amicus Capital Private Equity I LLP, up to 70,178 shares by Amicus Capital Partners India Fund-I and up to 5.64 lakh shares by other shareholders.

Nuvama Wealth Management, DAM Capital Advisors, and Equirus Capital are the lead managers of the issue.

Samra further added that they are always looking for the right investors who understand their business well.

In June 2023, Max Life Insurance bought shares in Capital Small Finance Bank for Rs 49.50 crore, taking its stake in the bank to 2.99 per cent.

"In June Max Life came up with a strategic partnership with us and they invested around three percent. Now since we are going for the public issuance, we are looking for the right set of investors. The investors who understand us better and who are able to support us in our growth journey, "he added.

Max Life Insurance Company has been allotted a total of 10.57 lakh equity shares. Each equity share has a face value of Rs 10. Additionally, a premium of Rs 458 per equity share has been paid. The total consideration for this allotment amounts to Rs 49,50,03,600, the bank said in a statement.

He also pointed out that in the time to come, maybe the regulator (RBI) will think of bridging the gap in the Small Finance Bank sectors. "Whatever there are that is with regard to of course your capital adequacy or your priority sector lending or the 50 percent loan target size requirement," said Samra.

Bank reported net profit of 32 percent in Q2FY24

On November 9, 2023 the bank reported that Profit After Tax increased by 32.37 percent Y-o-Y to Rs 54.39 crore. Bank's net worth has crossed Rs 700 crores to Rs 711.756 crores. However total [Business] has crossed Rs 12,800 crores with gross advances at Rs 5,865.94 crores and deposits at Rs 7,000.29 crores.

Starting with 47 branches, it has now expanded to more than 172 branches across Delhi, Haryana, Rajasthan, Himachal Pradesh, and the Union Territory of Chandigarh. The bank offers a range of loan products, including those for small and medium enterprises, agriculture, housing, and other needs, primarily serving small borrowers.

Established in 2000 by Samra, the Jalandhar-headquartered bank changed its name from Capital Local Area Bank to Capital SFB and commenced banking operations on April 24, 2016, becoming India's first small finance bank (SFB).