Fino Payments Bank made a weak stock market debut, as the shares were listed at Rs 544.35, a 6 per cent discount to its issue price of Rs 577 per share on the National Stock Exchange (NSE) on Friday. On the BSE, the stock opened at Rs 548, a 5 per cent discount to the issue price.
At 10:01 am; Fino Payments Bank was trading at Rs 582.55, a 1 per cent higher over its issue price on the BSE. The intraday high for the stock so far was Rs 583.35.
The initial public offering (IPO) of Fino Payments Bank had received lukewarm response with overall subscribtion of just 2x. The institutional portion was subscribed 1.65 times, the wealthy investor portion by 21 per cent, the retail investor portion was subscribed close to 6 times, and the portion reserved for employees by 93 per cent.
The IPO consisted of Rs 300 crore of fresh fund raise and Rs 900 crore of secondary share sale by promoter Fino Paytech. The bank will use the fresh proceeds to augment its tier-1 capital base to meet its future capital requirements.
Fino Payments Bank is a fintech company offering a diverse range of financial products and services that are primarily digital and have a payments focus. This is the first a payments bank made stock market debut today. Paytm, which too has a payments bank license, will list next week.
As of August 2021, about 51 per cent of micro-ATM deployed in the country is from Fino Payments Bank followed by SBM Bank at 12 per cent & SBI at 8 per cent. Fino had largest network with 7.2 lakh banking touchpoints, followed by Airtel Payments Bank (5 lakhs) & India Post Payments Bank (1.4 lakhs).
The unique framework of distribution, technology and partnership (DTP) enables it to serve target market efficiently and improve on three key challenges - scale, service and sustainability. For period between April, 2021 and August, 2021, the bank has second largest debit card outstanding at 2.88 million. The bank incurs minimal capital expenditure costs in connection with onboarding merchants, because the on-boarding & setup capital expenditure costs are borne by the merchant, ICICI Securities said in a note.
Fintech companies' demand is poised for growth on the back of rising internet penetration, higher disposable income, development of technology, low-cost infrastructure, government initiatives like UPI, etc. Going forward, India presents a huge opportunity for growth of fintechs owing to high potential in the underpenetrated customer segments. To attract mid-to-low-income customers and the rural population, there is a need to develop tailor-made solutions. There will be huge growth potential for players in payments, lending, wealth, Insurance, etc. segments. We believe Fino Bank is one of the key beneficiaries of opportunities in the sector, analyst at Religare Broking said in IPO product note.
Dear Reader,
Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.
As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.
Support quality journalism and subscribe to Business Standard.
Digital Editor
RECOMMENDED FOR YOU