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Ujjivan Repeats Equitas’ Success at IPO

Bangalore-based microfinance institution and small finance bank (SFB) licensee Ujjivan Financial Services has set off a new mark raising 40 times the amount of IPO it sought in the market.

The initial public offering (IPO) of Ujjivan was oversubscribed 40 times, with strong domestic demand both from retail and institutional investors. The total shares opened for the market were 29.7 million shares and the bids reached 1.2 billion shares worth Rs 25,200 crore. No foreign investors participated and the price to be fixed at the top brand of Rs.210 will mean Rs. 887 crore raised from the IPO route.

In the IPO, the institutional buyers’ segement was subscribed nearly 34 times and the retail segment was subscribed 135 times. Those subscribing Rs.2 lakh worth shares was four times more than sought.

Ujjivan raised pre-IPO funds worth Rs.300 crore while filing its draft red herring prospectus on December 31, 2015, with SEBI. Its investors include HDFC Life, Sundaram MF, Shriram Life and Family offices and HNI’s such as Desai Bros and others.

After SKS Microfinance, Equitas, Ujjivan is the third MFI to go market way to raise funds but Equitas and Ujjivan will soon become Small Finance Banks under RBI purview while SKS was denied the licence last year to float SFB.

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