Fino announces Rs 1,200 Cr initial share sale; first payments bank to go public

Fino Payments Bank on Tuesday announced a Rs 1,200 crore initial public offering (IPO), which will include a fresh issue of shares worth Rs 300 crore.

The company — which will emerge as the first payments bank to list on the stock exchanges — has set a price band of Rs 560-577 per share for the issue and will be open for subscription between October 29 to November 2.

It will raise up to Rs 300 crore from the fresh issue of shares while the Offer For Sale (OFS) component will see over 15 million shares sold by existing shareholders.

Fino Payments Bank's Managing Director and Chief Executive Rishi Gupta said the company does not believe in any cash burn or freebies, and has been profitable for more than a year now.

At present, it counts state-owned Bharat Petroleum, ICICI Group, and Blackstone among its shareholders.

Gupta said the OFS component will have the holding company sell shares, and the quantum of shares that will be sold by existing shareholders will be decided later.

The company said it serves 92 percent of the country's pin codes at present through a multi-tier network structure, which focuses on making the neighbourhood shopkeeper as the banker.

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It is adding over 6,300 accounts per day right now as against 3,000 during the pandemic-impacted FY21 and has a network of 7.7 lakh merchants.

As much as 97 percent of the company's income comes from transactions like remittances or cash management, which it carries out for customers. It also charges an upfront annual fee of Rs 449 per account.

Investors can bid for a minimum of 25 equity shares and in multiples of 25 equity shares thereafter, and a portion of up to Rs 3 crore has been reserved for eligible employees.

The company said that up to 75 percent of the total offer has been reserved for qualified institutional buyers, 15 percent for non-institutional investors, and the remaining 10 percent for retail investors.

Axis Capital, CLSA India, ICICI Securities, and Nomura Financial Advisory Services are the book running lead managers to the issue.

Fino Payments Bank is a scheduled commercial bank serving the emerging India market with its digital-based financial services.

The company is a fully-owned subsidiary of Fino Paytech. It is backed by investors like Blackstone, ICICI Group, Bharat Petroleum and International Finance Corporation (IFC).