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17 August 2023

Utkarsh Small Finance Bank IPO: Paving the Path for Inclusive Financial Growth

Introduction:

Established in 2016, Utkarsh Small Finance Bank Limited is a dynamic player in the Indian financial landscape, operating as a Small Finance Bank (SFB). Known for its remarkable asset under management (AUM) growth, the bank has secured the second-fastest AUM growth in Fiscal 2019 and Fiscal 2022 among SFBs with AUM exceeding Rs. 50 billion.

Empowering Individuals and Businesses:

Utkarsh Small Finance Bank is dedicated to extending financial support to both individuals and businesses, catering to their diverse financial needs. The bank's comprehensive range of services includes:

1. Accounts and Deposits: Offering a variety of account types and deposit options to cater to different customer preferences.
2. Cards: Providing card services for enhanced financial convenience.
3. Insurance and Investments: Facilitating insurance and investment solutions to secure the future.
4. Loans: Extending loans with flexible terms and efficient processing.
5. Ways to Bank: Delivering multiple channels for customers to access and manage their finances.

Key Offerings:

The bank has introduced several key offerings that distinguish its services:

- Top-up/Balance Transfer Facility: A seamless way to enhance financial liquidity.
- Hassle-free Processing with Easy Documentation: Simplifying loan processing for customers' convenience.
- Loan Amount and Tenure: Offering loans up to Rs. 50 crores with a tenure of up to 30 years.
- Efficient Eligibility: Providing straightforward eligibility criteria for both salaried and self-employed individuals.

Diverse Product Portfolio:

Utkarsh Small Finance Bank's product range is tailored to meet a variety of financial needs, including micro banking loans, retail loans, wholesale lending, housing loans, commercial vehicle/construction equipment loans, and gold loans. The bank's focus on microfinance underscores its commitment to inclusive financial growth.

IPO Details:

Utkarsh Small Finance Bank's upcoming IPO is a Book Built Issue with an issue size of Rs 500.00 Crores. Priced in the range of ₹23 to ₹25 per share, the IPO is set to be listed on both BSE and NSE. The subscription window for the IPO was open from July 12, 2023, to July 14, 2023, with the listing date scheduled for July 21, 2023.

Promoter Holding:

Utkarsh CoreInvest Limited holds the reins of the bank as its promoter. The pre-issue shareholding stands at 84.75%, which is expected to reduce to 69.28% post the IPO.

Financial Performance

Utkarsh Small Finance Bank's financial journey showcases impressive growth:

Total Assets	₹9,404.32 Crores to ₹19,117.54 Crores
Total Revenue	₹1,406.18 Crores to ₹2,804.29 Crores
Profit After Tax	₹186.74 Crores to ₹404.50 Crores
Net Worth	₹1,019.50 Crores to ₹2,000.32 Crores
Reserves and Surplus	₹260.23 Crores to ₹1,104.42 Crores

Expert Review:

Utkarsh Small Finance Bank's robust performance is underscored by its pivotal role as a leading SFB. The sustainability of current margins and regulatory policies remain focal points. While the IPO pricing is appealing, investors should assess the medium to long-term prospects while considering procedural adherence.

Conclusion:

The Utkarsh Small Finance Bank IPO presents investors with an opportunity to participate in an institution dedicated to driving inclusive financial growth. As the bank pioneers innovative financial solutions and promotes broader financial access, investors must evaluate their investment goals and consider the insights from expert reviews. Utkarsh Small Finance Bank's journey exemplifies its commitment to fostering financial inclusion and creating value for stakeholders. Investors poised to support inclusive financial growth can play an instrumental role in shaping the bank's future success.

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