Ujjivan Small Finance Bank (Ujjivan Bank) IPO Detail

Ujjivan Small Finance Bank IPO Detail

Ujjivan Bank’s Profile

On October 7, 2015 after getting RBI approval nod Ujjivan Financial Services Limited incorporated Ujjivan Small Finance Bank Limited on July 4, 2016 and began its operations on February 1, 2017. They got included in the second schedule to RBI Act, 1934 on July 3, 2017.

Promoter Business Overview

They are catering to unserved and underserved segments in India. Their Promoter is Ujjivan Financial Services Limited (UFSL) which commenced operations as NBFC in 2005 and was providing financial services to the ‘economically active poor’ with prima facie small support to economically active Poor Women which are not adequately served by Financial Institutions. It also offers loans to Micro and Small Enterprises (MSE’s)

Ujjivan Small Finance Bank (USFB) Business Overview

UFSB is among the leading small finance bank in India, they have launched “Sampoorna Banking” in Apr’19 whereby offering Education Loan, Vehicle Loan and insurance to families of existing micro banking customers with its reach in 24 states and union territories encompassing 221 districts. They are authorised to run Aadhar Enrollment Centers (AECs)

As on Jun 30, 2019 they have served 4.72 million customers with 287 Banking points, 387 ATMs and two 24X7 phone banking units in Bengaluru and Pune.

Ujjivan Small Finance Bank (USFB) Products and Services

1. Micro Loans to Individuals and groups,
2. Agriculture and allied loans,
3. Micro and small enterprise (MSE) Loans.
4. Affordable housing loans
5. Financial Institutions group Loans
6. Personal loans
7. Vehicle Loans

USFB has made significant investment in automation of its operations. They offer various services like Internet Banking, Mobile Banking, SMS Banking, Online Bill payments, Rupay Platinum Debit Cards, repayments through digital wallets and payment gateways, Automated credit processing and collection receipt system that brings down loan origination turnaround time for its customers.

There primary focus is on young middle class customers across India with intention to reduce cost and increase operational efficiencies.

Strengths

1. Deep understanding of Unserved and Underserved segments.
2. Pan India Presence.
3. Multiple Delivery channels and products.
4. Focus on Digitisation.
5. Strong promoter backup with Business Knowledge.
   
6. Profession team of quality people in organisation.

Financial Information (Fig Rs. in Cr.)

Objects of the Issue

1. To meet the RBI Tier – 1 capital requirements
2. To meet Issue Expense
3. Benefit from listing on stock market

Ujjivan Bank IPO Schedule

* Note : There is a discount of Rs. 2 per share for UFSL shareholders with cut off date 22nd Nov’2019, so effective rate would be Rs. 35 per share with reservation of 2,08,33,333 shares.

Ujjivan Small Finance Bank IPO Subscription Status (NSE + BSE)

Ujjivan Bank IPO Subscription Status

Recommendation for Ujjivan Bank IPO

The main peer of Ujjivan Small Finance bank is AU small finance bank which is available at a fair valuation, the Ujjivan small finance bank has strong back up of promoter but NPAs are major concern faced by banking industry even small finance banks these days. The net interest income (NII) of bank is constantly growing with a good pace giving strong bank to its financials. However, we recommend to apply for this IPO with care and investors with healthy risk appetite can apply for long term and bank have the capability to provide handsome returns in longrun. Further, based on subscription figures of Day one and day two one can consider for applying in this IPO for listing gains.

Ujjivan Bank GMP/Ujjivan Small finance Bank GMP

The GMP of Ujjivan Bank IPO is expected to remain between Rs. 20 – 22 per share as on December 3, 2019.

Frequently Asked Questions (FAQs)