Ujjivan Financial Services approach Sebi to float IPO

Ujjivan Financial Services, the microfinance lender that was granted licence to convert into a small finance bank, has filed draft papers with markets watchdog Sebi to raise at least Rs 650 crore through an IPO.

This is the second microfinance institution after Equitas Holding to approach the Securities and Exchange Board of India (Sebi) for an IPO this year.

Till date, only one microfinance firm SKS Microfinances had tapped the capital markets. In 2010, SKS Microfinances’ maiden public offering raised Rs 1,654 crore.

Ujjivan Financial Services, in September, received in-principle approval from the Reserve Bank to set up small finance banks to provide basic banking services to small farmers and micro industries.

The IPO comprises fresh issue of equity shares worth Rs 650 crore and an offer for sale up to 34,95,626 scrips to the existing shareholders.

Besides, the company is considering a Pre-IPO Placement of up to 22,000,000 equity shares for cash consideration up to Rs 450 crore.

The proceeds of the issue would be utilised towards augmenting the company’s capital base to meet future capital requirements.

In addition, the company “intends to reduce its foreign shareholding in accordance with the requirements of the SFB in-principle approval to set up an SFB.”

The issue is being managed by Kotak Mahindra Capital Company, Axis Capital, ICICI Securities and IIFL Holdings.

The equity shares are proposed to be listed on BSE and NSE.

Securities and Exchange Board of India ( SEBI )