Fino Payments Bank’s IPO Subscribed 87% and Retail Portion Booked 4.65 Times

Fino Payments Bank Limited (“Company”); one of the growing fintech company offering a diverse range of financial products and services that are primarily digital and have a payments focus, received bids of 99,90,600 shares against the offered 1,14,64,664 equity shares, as per the 5:00 pm data available on the bourses.

The initial public offering of Fino Payments Bank witnessed strong retail investor interest on the second day of subscription as well. Demand from non-institutional counterparts, too, picked up.

The portion reserved for retail investors was subscribed 4.65 times, the employee portion was subscribed 0.56 times and the Non-Institutional Investor category was subscribed 0.10 times, while the Qualified Institutional Buyer category didn’t see any response on Day 2. The Issue was subscribed 0.87 times.

The Offer comprises of a fresh issuance of Equity Shares aggregating up to ₹ 300 crores (“Fresh Issue”) and an offer for sale of up to 15,602,999 Equity Shares by Selling Shareholders.

Axis Capital Limited, CLSA India Private Limited, ICICI Securities Limited, and Nomura Financial Advisory and Securities (India) Private Limited are the book running lead manager to the Offer (“BRLM”)

Brokerage Houses like Ventura, Hem Securities, Nirmal Bang, Marwadi Share & Finance Ltd. etc. give a call to “SUBSCRIBE”.

Payments banks and fintechs have been increasing their presence and reach by increasing touch points through retail outlets which have a widespread presence in India. In India, the private final consumption expenditure (PFCE) was 58% of GDP in financial year 2021 at Rs. 116 trillion and India’s retail spending on goods was at ~50% of its private consumption.

Fintechs today are on top of the mind of traditional financial institutions as they watch traditional business models change, and increasingly deliberate whether to collaborate or compete withfintech. Digital payments landscape has the highest number of fintechs in India and now other financial segments like lending, insurance, wealth are also attracting fintechs.

Fino have a strong leadership position within the Indian fintech industry, as it was ranked third among banks in facilitating digital transactions, as of February 2020 by the Ministry of Electronic & Information Technology; and had the largest network of micro-ATMs, as of August, 2021. It is also the only payments bank to offer a subscription-based savings account in India. The unique framework of distribution, technology and partnership (the “DTP” framework) enables it to serve its target market efficiently and is used to overcome and/or achieve improvements on 3 key challenges associated with serving its target market - scale, service and sustainability.

Company Information

Fino Payments Bank is a fully owned subsidiary of Fino Paytech which had last raised funds in 2016. Fino Paytech is backed by marquee investors like Bharat Petroleum, ICICI group, Blackstone, IFC, Intel and LIC among others. Frugal innovation is the key that has given fintech a leadership position at the middle of the pyramid that primarily constitutes emerging India customers. It enjoyed a 55% market share in micro-ATMs in FY21.

The Mumbai-based fintech operates on an asset-light business model that principally relies on fee and commission-based income generated from merchant networks and strategic commercial relationships.

The payments bank platform has facilitated more than 434 million transactions with a gross transaction value of Rs 1.32 lakh crore in the financial year 2020-21. The fintech bank turned profitable in the fourth quarter of 2019-20 and has been profitable in subsequent quarterly periods. The bank registered a profit of ₹20.5 crore in 2020-21.