Utkarsh Small Finance Bank debuted on the stock market with a premium of 60 per cent over the issue price on Friday, adding to its momentum from the IPO. Varanasi-based small finance bank listed at Rs 40 in NSE and Rs 39.95 in BSE, against its IPO price of Rs 25. The bank's shares were trading at Rs 48 in the NSE with volume upwards of 26 crores as of 11:22 AM.
With an IPO of Rs 500 crore, Utkarsh Bank raised massive interest from the public. The IPO, listed from July 12-14, was subscribed almost 102 times, making it the second-highest subscription number after Ideaforge Technology in the current calendar year, as reported by MoneyControl. The section for qualified institutional buyers was subscribed 124.8 times, while non-institutional investors subscribed 81.6 times.
From catering to the micro-finance needs of the population of north India to maintaining investor-friendly pricing, Utkarsh Bank ensured the success of its listing. Experts credit the public-friendly price bank of Rs. 23-25 per share for the IPO's popularity.
The IPO had received a positive rating from most analysts. The brokerage firm Swastika Investment, as per a MoneyControl report, said, "The IPO is priced at a reasonable valuation, and the company has a strong balance sheet. However, there are some risks to consider, such as the competitive landscape and the potential for asset quality problems. Overall, we believe that the IPO is a good opportunity for investors who are looking for exposure to the growth of the SFB sector. So, we have subscribe rating for this IPO."
Additionally, limited exposure to the unsecured sector of microfinance has helped Utkarsh establish its stronghold in the market. Founded in 2016, Utkarsh provides a diversified range of products, from salary and current accounts to locker facilities among others.