Fedfina IPO: Fedbank Financial Services Ltd, a subsidiary of the Federal Bank, files an IPO

Business

oi-Shubham Kumar

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Feedback Financial Services (FedFina), a subsidiary of Federal Bank, has filed its draft Red Herring Prospectus (DRHP) with SEBI for an IPO of its shares on February 19, 2022.

FedFina intends to launch an initial public offering of shares of FedFina with a nominal value of Rs.10 each (offer), which will include a new issue of participating shares by FedFina worth up to Rs.900 crore (new issue), as well as an offer to sell up to 1,64,97,973 equity shares by Federal Bank and up to 2,92,16,313 equity shares by True North Fund VI LLP.

The principal managers of the issue are ICICI Securities Limited, Equirus Capital Private Limited, IIFL Securities Limited and JM Financial Ltd.

The offering includes underwriting booking by Federal Bank and FedFina skilled workers, as well as the bank’s shareholders, according to the private sector bank. The offer is subject to the receipt of necessary approvals, market circumstances and other factors.

FedFina earned a net profit of Rs 61.68 crore on total revenue of Rs 697.72 crore in FY21. The net worth of the company was Rs 834.73 crore as of March 31, 2021. FedFina will remain a subsidiary of the Federal Bank after the proposed IPO, according to the lender. The Lender will retain more than 51% of the outstanding share capital when the transaction is finalized.

Fedbank Financial Services Ltd (Fedfina)

Federal Bank subsidiary FedFina is the fastest growing gold lending NBFC in India. It is now active in 15 Indian states and union territories, having a considerable presence in the south and west of the country It has 463 branches as of September 2021, covering 136 districts in 15 Indian states and union territories, and 86.25% of its total loan assets were secured by physical assets, such as gold or customer property. It had an AUM of Rs 2,933.83 Cr in installment loans to MSMEs and ESEIs, and Rs 2,132.92 crore in gold loans. NBFC offers medium-term, low-cost property (LAP) loans, business loans, as well as gold loans.

Article first published: Monday, February 21, 2022, 5:48 p.m. [IST]

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