Capital Small Finance Bank Ltd
Complete IPO details, including price band, financials, subscription status, and key insights.
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IPO Snapshot
Key metrics and details at a glance.
Price Band
₹468
Per ShareLot Size
32 Shares
Minimum Investment
₹14,976
Issue Size
₹523.07 Cr
Face Value
₹10
Per ShareIPO Type
Book Building
Retail Quota
35%
QIB Quota
50%
NII Quota
15%
IPO Timeline
Important dates for your applying strategy.
Subscription Status
Live demand across investor categories.
Track real-time subscription levels:
*Real-time data subject to exchange updates
Capital Small Finance Bank Ltd
Business model, operations, and market positioning.
Promoter Holding (Pre-Issue)
22.39%
Issue Type
Book Building
ISIN
INE646H01017
About the Company
Capital Small Finance Bank Limited is regulated by RBI and commenced operations as India's first small finance bank in 2016 pursuant to RBI's approval dated March 4, 2016. The Bank offers a range of banking products on the asset and liability side, in all the states it operates in, i.e., Punjab, Haryana, Delhi, Rajasthan, Himachal Pradesh and Union Territory of Chandigarh, with its asset products primarily including agriculture loans, MSME and trading loans and mortgages. The Bank focuses primarily on the middle-income customer segments through its presence primarily in Punjab, Haryana, Rajasthan, Delhi, Himachal Pradesh and Union Territory of Chandigarh. The Bank has an experience of over two decades in the banking industry, having been incorporated in 1999. As on the date of this Red Herring Prospectus, the Bank does not have any subsidiaries.
Industry Overview
Despite various measures taken by the government to boost financial penetration in India, a significant percentage of the country's population is still without access to financial services. The objectives of setting up of small finance banks were to further financial inclusion by provision of savings vehicles, and supply of credit to small business units, small and marginal farmers, micro and small industries and other unorganised sector entities, through high technology-low-cost operations. With a similar objective to encourage competition and enhance the easy availability of financial services to the population, RBI introduced various guidelines such as the `Guidelines for Licensing of Payment Banks', in November 2014, the `Operating Guidelines for Payment Banks', in October 2016 and the `Guidelines for `on-tap' Licensing of Small Finance Banks in the Private Sector', in December 2019. As of July 2021, the RBI had awarded SFB licenses to 12 institutions.
Company History
The Bank was incorporated as `Capital Local Area Bank Limited' on May 31, 1999 at Phagwara district Kapurthala, Punjab, as a public limited company under the Companies Act, 1956, and was granted a certificate of incorporation by the Registrar of Companies, Punjab, Himachal Pradesh and Chandigarh. The name of the Bank was subsequently changed to `Capital Small Finance Bank Limited' pursuant to a shareholders' resolution dated April 2, 2016, to reflect the change in status of the Bank from a local area bank to a small finance bank pursuant to the Reserve Bank of India approval dated March 4, 2016, and a fresh certificate of incorporation was granted by the Registrar of Companies, Punjab and Chandigarh at Chandigarh ("RoC") on April 15, 2016. The Bank commenced its business pursuant to a certificate of commencement of business issued by the Registrar of Companies, Punjab, Himachal Pradesh and Chandigarh dated August 12, 1999.
Products & Services
- Agriculture loans, MSME and trading loans and mortgages.
Growth Strategy
- Continue to grow its loan book organically with focus on secured lending.
- Strengthen its liability franchise.
- Leverage technology and data analytics for scalability and profitable growth.
- Customer Centric Initiatives.
- Initiatives Driving Operational Efficiencies.
- Focus on strengthening its operational and profitability metrics.
- Improve credit to deposit ratio.
- Focus on optimising costs.
- Focus on improving share of fee income and leverage cross-selling opportunities.
Customer Base
Middle-income customer
Financial Performance
Revenue, profit after tax and total assets across the last 3 reported financial years.
Revenue
Amount in ₹ crore
Profit After Tax (PAT)
Amount in ₹ crore
Total Assets
Amount in ₹ crore
Figures in ₹ crore, on a standalone basis, as reported for FY24 to FY26.
Objects of the Issue
How the company plans to utilize IPO proceeds.
Use of Proceeds
The funds raised through this IPO will be used for:
Initial public offer of 11,176,713^ equity shares of face value of Rs. 10 each ("Equity Shares") of Capital Small Finance Bank Limited ("Bank" or "Issuer") for cash at a price of Rs. 468 per equity share (including a share premium of Rs. 458 per equity share) ("Offer Price"), aggregating to Rs. 523.07^ crores (the "Offer"), comprising a fresh issue of 9,615,384^ equity shares aggregating to Rs. 450.00^ crores (the "Fresh Issue") and an offer for sale of 1,561,329^ equity shares aggregating to Rs. 73.07 crores (the "Offer for Sale"), comprising 836,728^ equity shares aggregating to Rs. 39.16^ crores by Oman India Joint Investment Fund ii ("IJIF" II", 151,153^ equity shares aggregating to Rs. 7.07^ crores by Amicus Capital Private equity i llp (""ACPE"), 17,544^ equity shares aggregating to Rs. 0.82^ crores by Amicus Capital Partners India fund i ("ACPIF", together with acpe, "Amicus", and together with ACPE, and OIJIF II, the "Investor selling shareholders"), and 555,904^ equity shares aggregating to Rs. 26.02^ crores by certain persons listed in this prospectus (the "Other Selling Shareholders", as defined below) (the investor selling shareholders and the other selling shareholders, collectively, the "Selling Shareholders", and such equity shares offered by the selling shareholders, the "Offered Shares"). The face value of the equity shares is Rs. 10 each and the offer price is 46.80 times the face value of the equity shares. ^Subject to finalization of basis of allotment.
*Subject to approvals and market conditions.
Strengths & Risks
Key competitive advantages and factors to consider before investing.
- Retail Focused Liability Franchise with High Share of CASA.
- Secured and diversified advances portfolio.
- Streamlined credit assessment processes and risk management practiceo.
- Customer centric approach and understanding of target customers.
- Consistent track record of growth with constantly improving operational and profitability metrics.
- Its business is concentrated in North India, with approximately 87% of its total branches located in the state of Punjab. Any adverse change in the economy of North India could have an adverse effect on its financial condition, results of operations and cash flows.
- The Bank is subject to strict regulatory requirements and prudential norms. If its unable to comply with such laws, regulations and norms it may have an adverse effect on its business, financial condition, results of operations and cash flows.
- The bank is subject to certain prudential norms. If its unable to comply with these norms it may have an adverse effect on its business, financial condition, results of operations and cash flows.
- As at three months ended June 30, 2023 and June 30, 2022 and Fiscals ended March 31, 2023, 2022 and 2021, our gross NPAs to gross advances were 2.81%, 2.93%, 2.77%, 2.50% and 2.08% and its provision coverage ratio was 51.90%, 42.50%, 51.48% 46.02% and 46.14%, respectively. If the bank is unable to control the level of NPAs in its portfolio effectively or if its unable to improve or maintain the bank provisioning coverage as a percentage of gross NPAs, its business, financial condition, results of operations and cash flows could be adversely affected.
- Its may be impacted by volatility in interest rates, which could cause its Net Interest Margin to decline and adversely affect its results of operations and cash flows.