The issue received applications for 1,19,60,925 shares against the total on offer 1,14,64,664 shares. This translated into a total subscription of 1.04 times.
Fino Payments Bank is looking to raise Rs 1,200 crore from the primary markets. The IPO is a mix of fresh issues worth Rs 300 crore, whereas its promoter Fino Paytech will offload 1,56,02,999 equity shares worth Rs 900.29 crore.
The issue garnered mixed responses from brokerages as they weighed the company’s asset-light model and long-term growth prospects against its high valuations, which they see as a key risk for the issue.
Considering the TTM as of June 2021, adjusted BVPS of Rs 54.52 on the post-issue basis, the company is going to list at a Price to book value P/B of 10.58, with a market cap of more than Rs 4,8015 crore, said Marwadi Shares and Finance.
“The company has an asset-light and scalable business model, with operational experience and expertise. It has a unique DTP framework that enables it to serve the target market efficiently,” said the brokerage, giving it a ‘subscribe’ rating.
Reliance Securities, meanwhile, said the IPO is valued at 31.9 times FY21 book value, which looks to be stretched. Notably, Fino being a fintech, generates over 95 per cent of its income through fees and commissions, and future growth is primarily dependent on incremental wallet share digital payment opportunity in the country, it added.
“FPBL is poised to see healthy business opportunity in subsequent years in the backdrop of strong digital platform and resources built in the last couple of years. However, we believe current valuations do not leave much on the table for investors in the medium-term perspective,” it said.
Fino Payments Bank has appointed Axis Capital, CLSA India, ICICI Securities and Nomura Financial Advisory and Securities (India) to manage the issue.
