Utkarsh Small Finance Bank makes a strong debut on Dalal Street; what should investors do?
Utkarsh Small Finance Bank shares entered the listing space with a bang on Friday, July 21. The Utkarsh Small Finance Bank IPO - to raise up to Rs 500 crore - concluded last week with a subscription of almost 102 times the shares on offer.
Utkarsh Small Finance Bank shares made a strong debut in the secondary market on Friday, beginning their journey at Rs 39.95 apiece on BSE — a premium of 59.8 per cent over the upper end of the IPO price range. On NSE, the stock opened at Rs 40 apiece, a premium of 60 per cent. The listing was in line with market wizard Anil Singhvi's expectations.
The stock finished the listing day at Rs 47.9 apiece on BSE and Rs 48 apiece on NSE.
The market debut of Utkarsh Small Finance Bank shares comes after the lender's initial public offer (IPO), to raise up to Rs 500 crore, concluded last week with a robust response from investors. The IPO of Utkarsh SFB — a Varanasi, Uttar Pradesh-based small finance bank — comprised fresh issuance of shares.
EDITOR'S TAKE | Invest for long term
Zee Business Managing Editor Anil Singhvi, who recommended applying for the Utkarsh Small Finance Bank IPO for "big listing gains", suggests investors buy the lender's shares from a long-term perspective. He has identified the following key points about the small finance bank for investors:
Positive
- Promoters' strong background
- Huge growth opportunity
- Attractive valuation
Negative
- Cost of funds higher than peers
- Asset quality not stable
- Profit jumped just before the IPO
Here are some of the important details about the Utkarsh Small Finance Bank IPO:
The IPO opened for subscription on July 12 and closed on July 14. Under the IPO, potential investors could bid for Utkarsh Small Finance Bank shares in a range of Rs 23-25 apiece in multiples of 600, translating to Rs 13,800-15,000 per lot.
At the end of the three-day bidding process, the IPO received bids for 1,228.5 crore shares as against the 12.1 crore shares on offer, marking an overall subscription of 101.9 times.
Here's how different investors responded to the issue:
| Category | Reservation | Subscription (No. of times the shares on offer) |
| Qualified institutional buyers (QIBs) | Up to 75% | 124.9 |
| Non-institutional investors (NIIs) | Up to 15% | 81.6 |
| Retail investors | 10% | 72.1 |
| Total | 100% | 101.9 |
Read more on Utkarsh Small Finance Bank IPO
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