Equity L/S Analyst | Forensic Accounting | India, Yellowstone Equity

Ankit Agrawal, CFA

Equity L/S Analyst | Forensic Accounting | India

Equity Bottom-Up

Ujjivan Small Finance Bank  / Equity Bottom-Up

<p>Ujjivan Small Finance Bank (USFB) is a mass-market focused small finance bank (SFB) providing financial services to un-served and under-served segments of Indian population, led by its commitment towards financial inclusion. Its promoter entity, Ujjivan Financial Services Ltd (UFSL), commenced operation as an NBFC in 2005 with a focus on providing microfinance (MFI) loans (typically group loans with small ticket size at &lt; INR 100,000). MFI loans are typically income generating loans and play a crucial role in upliftment of the bottom strata of the society. Accordingly, they are a key focus area for the RBI and the government. SFBs and NBFC-MFIs (NBFCs registered as Micro-Finance Institutions) are some of the entities that cater extensively to this segment under the supervision of RBI.</p>
<p>USFB’s robust financial performance, despite several crises faced by the sector, coupled with its high quality management, reasonable valuations and strong growth tailwinds for the sector, lends USFB a favorable setup. <strong>We recommend participating in the IPO.</strong></p>
<p>USFB's issue size was of INR 1000cr, of which INR 250cr amount has already been placed via pre-IPO. Remaining 750cr is available for subscription via the IPO. The key objective of the IPO is to fulfill licensing mandate from RBI that requires USFB to list by Jan 31, 2020. There is no Offer for Sale and proceeds from the IPO is stipulated to be used as growth capital.</p>

Ujjivan Small Finance Bank (USFB) is a mass-market focused small finance bank (SFB) providing financial services to un-served and under-served segments of Indian population, led by its commitment towards financial inclusion. Its promoter entity, Ujjivan Financial Services Ltd (UFSL), commenced operation as an NBFC in 2005 with a focus on providing microfinance (MFI) loans (typically group loans with small ticket size at &lt; INR 100,000). MFI loans are typically income generating loans and play a crucial role in upliftment of the bottom strata of the society. Accordingly, they are a key focus area for the RBI and the government. SFBs and NBFC-MFIs (NBFCs registered as Micro-Finance Institutions) are some of the entities that cater extensively to this segment under the supervision of RBI.
USFB’s robust financial performance, despite several crises faced by the sector, coupled with its high quality management, reasonable valuations and strong growth tailwinds for the sector, lends USFB a favorable setup. We recommend participating in the IPO.
USFB's issue size was of INR 1000cr, of which INR 250cr amount has already been placed via pre-IPO. Remaining 750cr is available for subscription via the IPO. The key objective of the IPO is to fulfill licensing mandate from RBI that requires USFB to list by Jan 31, 2020. There is no Offer for Sale and proceeds from the IPO is stipulated to be used as growth capital.

Ujjivan Small Finance Bank IPO: An Opportunity to Cherish!

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

Ujjivan Small Finance Bank  / Equity Capital Markets

<div><p><a href="https://www.smartkarma.com/entities/ujjivan-financial-services" target="_blank" data-smartkarma-citation="entities:22697:1" rel="noopener">Ujjivan Financial Services (UJJIVAN IN)</a> plans to list its small finance bank, <a href="https://www.smartkarma.com/entities/ujjivan-small-finance-bank-ltd" target="_blank" data-smartkarma-citation="entities:28443:1" rel="noopener">Ujjivan Small Finance Bank (USFB IN)</a>. The latter aims to raise around US$105m of new capital through the issue.</p></div><div>
<div><p>Post the commencement of operations of the SFB, Ujjivan transferred most of its assets and operations to the SFB. It's now being made to list the SFB to comply with the regulatory requirements of listing the SFB within three years of operations, i.e. on or before end of Jan 2020. </p></div>
<p>I had earlier covered Ujjivan's IPO in 2016, <a href="https://www.smartkarma.com/insights/ujjivan-financial-ipo-morphing-into-a-bank-gives-it-a-license-to-mint-money-while-doing-some-good" target="_blank" rel="noopener">Ujjivan Financial IPO - Morphing into a Bank Gives It a License to Mint Money While Doing Some Good</a>, at which time the SFB was about to be setup. I have also covered the background of this listing in <a href="https://www.smartkarma.com/insights/ujjivan-small-finance-bank-pre-ipo-shouldn-t-be-forced-to-list" target="_blank" rel="noopener">Ujjivan Small Finance Bank Pre-IPO - Shouldn’t Be Forced to List.</a></p>
</div><div><p>In this insight, I'll touch upon the dynamics of the deal and have a brief look at the financial performance. </p></div>

Ujjivan Financial Services (UJJIVAN IN) plans to list its small finance bank, Ujjivan Small Finance Bank (USFB IN). The latter aims to raise around US$105m of new capital through the issue.
Post the commencement of operations of the SFB, Ujjivan transferred most of its assets and operations to the SFB. It's now being made to list the SFB to comply with the regulatory requirements of listing the SFB within three years of operations, i.e. on or before end of Jan 2020. 
I had earlier covered Ujjivan's IPO in 2016, Ujjivan Financial IPO - Morphing into a Bank Gives It a License to Mint Money While Doing Some Good, at which time the SFB was about to be setup. I have also covered the background of this listing in Ujjivan Small Finance Bank Pre-IPO - Shouldn’t Be Forced to List.
In this insight, I'll touch upon the dynamics of the deal and have a brief look at the financial performance. 

Ujjivan SFB IPO - Might Not Be as Good as the Previous Listing but It Has an Alternative as Well

India

Ujjivan Small Finance Bank Limited operates as a bank. The Company offers various types of financial services such as saving account, deposits, loans, and insurance solutions. Ujjivan Small Finance Bank serves customers in India.

Ujjivan Small Finance Bank  (UJJIVANS IN)

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Ujjivan Small Finance Bank (UJJIVANS IN)

Ujjivan Small Finance Bank IPO: An Opportunity to Cherish!

Ujjivan Small Finance Bank (USFB) is a mass-market focused small finance bank (SFB) providing financial services to un-served and under-served...

Ankit Agrawal, CFA

Ujjivan SFB IPO - Might Not Be as Good as the Previous Listing but It Has an Alternative as Well

Ujjivan Financial Services (UJJIVAN IN) plans to list its small finance bank, Ujjivan Small Finance Bank (USFB IN). The latter aims to raise around...

Sumeet Singh

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