Repco Home Finance ends marginally lower on debut

Shares of state-owned Repco Home Finance listed on the BSE and NSE today. On the BSE, the share closed at Rs 168.85 against its issue price of Rs 172 per share. It touched an intraday high of Rs 176 and an intraday low of Rs 158.05.

The objective of this issue is to enhance capital base to meet future capital requirements and the company will target the under-penetrated tier-II cities to drive growth, managing director R Varadarajan said in an interview to CNBC-TV18. 

"A Crisil report says the penetration level of housing finance is very low. On the rural side, the penetration is only about 8.2 percent. So nearly 92 percent of the rural population is still left out of the institutional finance," he elaboarted.

Chennai-headquartered Repco Home Finance offered 1.57 crore equity shares with a face value of Rs 10 each to raise Rs 270 crore. This included a reservation of 1.8 lakh equity shares for subscription by eligible employees.

Also read: Eyeing tier-II cities to drive growth: Repco Home Finance

The company had decided to offer a discount of Rs 16 on the issue price to eligible employees. The issue opened on March 13 and closed on March 15.

Repco Home Finance is promoted by the Repatriates Co-operative Finance and Development Bank (Repco Bank), which was set up in April 2000 to extend banking services to rehabilitate the repatriates from Sri Lanka, Myanmar, Vietnam and other countries.

Pre-issue, Government of India Centre owned 76.83 per cent in the Repco Bank, while Tamil Nadu holds 3.05 per cent, Andhra Pradesh 1.81 per cent, Kerala 0.62 per cent, Karnataka 0.18 percent and Repco Bank 17.51 per cent.

Post issue, the share of Repco Bank fell to 37.3 per cent from existing 50.02 per cent. The proceeds of the issue would be utilised towards augmentation of capital base, which would result in rise in net worth coupled with meet future capital adequacy requirements.