Jana Small Finance Bank rebounds sharply after weak IPO: Should you buy, sell or hold?

Amit Goel, co-founder and chief global strategist at Pace 360 suggested that investors with shares should park funds for medium- to long-term rewards. "While the lender marked a setback in margins for FY22 in line with general trends for the industry on account of the coronavirus pandemic, it is back on track as indicated by its financial performance from FY23 onwards", Goel said. He also added that the issue is reasonably priced based on the annualised FY24 earnings.

Shreyansh V. Shah, Research Analyst at StoxBox, advised investors who have been allotted the shares to hold them for the long term as the issue price has been reasonably valued. "We believe that the small finance bank is growing as it has transitioned its focus from microfinance loans to expanding its secured loan book, including affordable housing loans, secured business loans, gold loans, MSME loans, and two-wheeler loans", Shah said, referring to the growth prospects of the bank.

The Rs 570-crore offer, comprising a fresh issue of 1.11 crore shares valued at Rs 462 crore and an offer for sale (OFS) of 26.08 lakh shares worth Rs 108 crore, received a robust subscription of 19.8 times. The price band for the IPO was set at Rs 393-414 per share.

Jana SFB is the fourth largest small finance bank in terms of AUM and deposit size. As of September 30, 2023, the bank had 771 banking outlets.

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