Suryoday Small Finance Bank IPO Details and Review

Dates, Price band, Lot size, Risks, Review and broker recommendations etc.
Suryoday SFB IPO

Suryoday SFB IPO: Key Details

  • Grey Market Premium (GMP) today: ₹25 – ₹30
  • Raised 170 crore via anchor investor sale @305

Note: We neither trade nor encourage our readers to trade in the Grey Market. We share the GMP information for educational purposes only, so that, you can make an informed decision.

Company Information

Suryoday Small Finance Bank, incorporated in 2017 as an SFB, is a leading SFB in India in terms of net interest margins, return on assets, yields and deposit growth and had the lowest cost-to-income ratio among SFBs in India in Fiscal 2020.

Prior to commencement of operations as an SFB, they operated as an NBFC carrying out microfinance operations and operated the joint liability group-lending model for providing collateral-free, small ticket-size loans to economically active women belonging to weaker sections. Their average “priority sector” loans, as a percentage of average ANBC for Fiscal 2018, 2019 and 2020 and nine months ended December 31, 2020 was 99.08%, 112.10%, 103.67% and 114.09%, respectively. Over the years, they have diversified their loan portfolio to include non-micro banking loans thereby reducing the dependence on micro banking business.

Competitive Strengths

  • Customer centric approach with a focus on financial inclusion
  • Diversified asset portfolio with a focus on retail operations
  • Fast evolving granular deposit franchise
  • Leveraging emerging technologies to enhance digital footprint
  • Strong credit processes and robust risk management framework
  • Track record of strong financial performance and cost efficient operations
  • Experienced leadership team, professional management and strong corporate governance

Company Strategy

  • Expand asset portfolio while focusing on secured lending
  • Strengthen the retail liability franchise
  • Continue to focus on technology and data analytics to grow operations
  • Expand geographic presence and penetrate further into existing geographies

Proceeds from Suryoday SFB IPO will be used to:

  • Augment Bank’s Tier – 1 capital base to meet bank’s future capital requirements.
  • Receive the benefits of listing the Equity Shares on the Stock Exchanges

Suryoday SFB IPO: Financials

201820192020 Mar2020 Dec
Interest Earned₹286.88 Cr₹530.11 Cr₹766.69 Cr₹624.35 Cr
Total Income₹324.93 Cr₹597.03 Cr₹854.14 Cr₹689.27 Cr
Net Profit11.49 Cr₹90.39 Cr₹111.20 Cr₹54.87 Cr
EPS (Basic)1.7613.3513.416.19
Basis for PricingEPS (Avg)P/E (Floor)P/E (Cap)
Based on basic EPS11.4526.4626.64

Comparison with listed industry peers

CompanyP/E (Cap)
Suryoday SFB26.64
Sector Highest48.34
Sector Lowest12.14
Sector Average25.15

Suryoday SFB IPO Dashboard

Issue Details

TypeValue
Issue Size₹582.34 Cr
Fresh Issue₹248.58 Cr
Offer for Sale₹333.76 Cr
Face Value₹10/- per Equity Share
IPO Price₹303 – ₹305
Lot Size49 shares
LotsMin 1 – Max 13

Key Dates

Date TypeDate
Bid Open17/03/2021
Bid Close19/03/2021
Allotment Finalization24/03/2021
Initiation of Refunds25/03/2021
Credit of Shares26/03/2021
Listing Date30/03/2021

Lot Size and Price

LotsSharesAmount
149₹14,945
13637₹1,94,285

Promoter Holding

HoldingPercentage
Pre-Issue30.35%
Post-Issue28.02%
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Suryoday SFB IPO: Investor Quota and Shares Offered

Investor TypeQuotaShares on Offer
QIB50%[●]* shares
NII15%[●] shares
RII (Retail)35%[●] shares
Total100%[●] shares
Shares left after anchor investor sale of 229 Crore @ 305

Suryoday SFB IPO: Risks

  • Suryoday SFB is currently significantly dependent on advances to inclusive finance (JLG) customers and any adverse developments in the microfinance sector including any regulatory changes could adversely affect the business
  • Inability to comply with stringent regulatory requirements and prudential norms set for banks may have an adverse effect on the business
  • The Bank and its Directors are involved in certain legal proceedings, any adverse developments related to which could materially and adversely affect the business
  • Business is vulnerable to interest rate risk, and any volatility in interest rates or inability to manage interest rate risk could adversely affect the business
  • Bank’s deposits depend on a limited number of customers and a loss of such customers could materially and adversely affect cash flows

For complete internal and external risk factors, you can refer the RHP of the company.

Suryoday SFB IPO: Registrar and Lead Managers

Registrar of the Issue

KFintech (Formerly Karvy)
Selenium Building, Financial District, Nanakramguda, Serilingampally,
Rangareddi, Telangana India – 500 032.

Phone:040-67162222
Email: [email protected]

Lead Managers of the Issue

Axis Capital Limited
ICICI Securities Limited

IIFL Securities Limited
SBI Capital Markets Limited

Phone: +91-22-4325 2183 / +91-22-2288 2460
Email: [email protected]

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