Bandhan Bank to launch up to Rs 4,473-crore IPO next week

Private-sector lender Bandhan Bank Ltd will launch an up to Rs 4,473 crore(USD 688.6 million) initial public offering of shares on March 15, in what will be the biggest initial share sale by an Indian bank.

The Kolkata-based bank and its shareholders will be selling up to 119.3 million shares, or about 10 percent of the post-issue share capital of the bank, in a price range of Rs 370-375 each in the IPO, according to a prospectus and public notice on Thursday.

Bandhan, formerly a microfinance company specialising in small-value loans, and IDFC Bank were the only two companies to win bank permits from the Reserve Bank of India in 2014, the first bank licensing process in a decade.

Bandhan Bank, which started operations in August 2015, currently has 893 branches across India, with deposits of more than Rs 27,230 crore (USD 4.2 billion) and outstanding loans of Rs 26,378 crore, according to its website.

For the nine months to end-December 2017, it reported a net profit of Rs 960 crore and about Rs 1,100 crore in the full year to March 2017, Bandhan, which also counts Singapore state investor GIC among its investors, said in the prospectus.

Bandhan's planned IPO is also the biggest in the Indian market so far in 2018, after last year's record of about $11 billion in funds raised from initial share sales.

The IPO, however, comes at a time when Indian stock markets have corrected nearly a tenth from record highs reached in late January.

Banks, in particular, have been hit by worries over rising bad loan provisions and a sprawling USD 2 billion fraud in state-run Punjab National Bank.

In the IPO, Bandhan bank will sell up to 97.7 million new shares. Its shareholders International Finance Corp, part of the World Bank Group, and IFC FIG will sell 21.6 million shares in the sale that will close for subscription on March 19.