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News18 » Business
1-min read

SBI Cards IPO Gets Sebi’s Green Signal, May Launch in February Itself

SBI Cards is likely to raise up to Rs 6,000 crore through the IPO, but no official confirmation has been made regarding the size of the issue.

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Updated:February 12, 2020, 10:52 AM IST
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SBI Cards IPO Gets Sebi’s Green Signal, May Launch in February Itself
A file photo of an SBI branch in Kolkata. (Reuters)

SBI Cards and Payment Services, the credit card unit of the country’s largest lender State Bank of India (SBI), may launch its initial public offering (IPO) by the end of this month as market regulator Securities and Exchange Board of India (Sebi) finally gave its in-principle approval for the offer on Tuesday.

SBI Cards is likely to raise up to Rs 6,000 crore through the IPO, though no official confirmation has been made regarding the size of the issue. According to various reports, the IPO would value the company at approximately Rs 55,000-60,000 crore.

SBI Cards had filed its draft red herring prospectus (DRHP) with Sebi in November. As per the DRHP, the public issue comprises a fresh issue of Rs 500 crore and an offer for sale (OFS) of up to 13.05 crore equity shares.

The OFS includes up to 3.73 crore equity shares by SBI and up to 9.32 equity shares by CA Rover Holdings. Currently, SBI holds a 74% stake in SBI Cards and the rest is held by CA Rover Holdings, an affiliate of Carlyle Asia Partners IV.

Up to 18.65 lakh shares have been reserved for employees of SBI Cards, whereas 1.3 crore shares have been reserved for SBI shareholders.

In the DRHP, SBI Cards had stated that it intended to use the proceeds of the fresh issue for augmenting its capital base to meet future capital requirements.

The book running lead managers to the issue are Kotak Mahindra Capital Company, Axis Capital, DSP Merrill Lynch, HSBC Securities and Capital Markets (India), Nomura Financial Advisory and Securities (India) and SBI Capital Markets.

After Sebi’s approval for SBI Cards IPO on Tuesday, SBI shares opened 1.7% higher on Wednesday at Rs 329.90. The stock has risen nearly 19% in the last one year compared with a nearly 12% rise in the Nifty 50 index.

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