Tepid listing: Fino Payments Bank list at Rs 544.35 a discount of 5.66%

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Fino Payments Bank made a disappointing debut on the bourses. Shares of the bank opened for trading at a 5.66% discount over the issue price of Rs 577 per share. The stock opened at Rs  544.35 apiece on the National Stock Exchange (NSE) and at Rs 548 on the BSE.

The public issue of the payments bank was subscribed 2.03 times. The issue received bids for 2,32,46,150 shares as against 1,14,64,664 shares on the last day of the offer. The retail investors category was subscribed 5.92 times. The portion set aside for non-institutional investors was subscribed 21%, while qualified institutional buyers’ portion was booked 1.65 times.

The Rs 1,200.29 crore public offer comprised of a fresh issue to raise Rs 300 crore and an offer of sale (OFS) of 1,56,02,999 shares. The bank proposes to utilize the net proceeds from the fresh issue towards augmenting its Tier-I capital base to meet its future capital requirements. Additionally, the bank expects to receive the benefits of listing the equity shares on the stock exchanges.

Ahead of the IPO, Fino Payments Bank on October 27, 2021 finalized allocation of 93,37,641 equity shares to anchor investors at an allocation price of Rs 577 per share, aggregating to Rs 538.78 crore.

Fino Payments Bank is a growing fintech company offering a diverse range of financial products and services that are primarily digital and have payments focus. It offers such products and services to target markets via a pan-India distribution network and proprietary technologies. The bank has grown its operational presence to cover over 90% of districts end September 2021.

The payment business operates an asset-light business model that principally relies on fee and commission-based income generated from merchant networks and strategic commercial relationships. Each merchant serves the banking and financial needs of its community, which in turn form the backbone of assisted-digital ecosystem, referred to as “phygital” delivery model (i.e., a combination of physical and digital). The use of analytics on the data enhances the merchant’s ability to cross sell the third-party products offered by the bank to existing customers, thereby increasing potential revenue and opportunity to further customize products and services offering.

The bank reported a net profit of Rs 3.13 crore on a net total income of Rs 203.19 crore in the quarter ended June 2021.