SBI Funds Management Limited, a subsidiary of the country’s largest lender State Bank of India Limited, on Thursday, July 9, announced a price band of Rs 545 to Rs 574 per share for its Rs 11,693 crore initial public offering (IPO). This will be the biggest public issue of the bank so far. Let us give you all the information regarding this IPO…
SBI Funds Management IPO schedule
The anchor book will open on Monday, July 13. The IPO will open for subscription on Tuesday, July 14 and will close on Thursday, July 16. The basis of allotment will be decided on Friday, July 17. Refunds and unblocking of funds for eligible and ineligible applicants will take place on Monday, July 20. Shares will be credited to the demat account of successful bidders on the same day. Shares of SBI Funds Management are likely to be listed on the stock exchange on Tuesday, July 21.
Price Band, Lot Size and Investment
The face value of each equity share is Re 1. This IPO is entirely an ‘Offer for Sale’ (OFS) of more than 20 crore shares, with no new issue of equity. SBI Funds Management will not get any money from this offering. There will be 26 shares in one lot. At the upper level of the price band, retail investors bidding for one lot will have to invest a minimum of Rs 14,924. After this, bidding can be done in multiples of 26 shares.
Reservation information
35 percent of the total issue has been reserved for retail investors, 5 percent for small HNIs, 10 percent for large HNIs and the remaining 50 percent for qualified institutional bidders (QIBs). Existing shareholders of SBI will get the benefit of shareholder reservation in IPO. About 1.3 crore shares (worth approximately Rs 750 crore) have been set aside for eligible SBI shareholders.
Shares worth Rs 170 crore have also been reserved for eligible employees, who will get a discount of Rs 54 per share while bidding. There is no relaxation for existing SBI shareholders under the shareholder reservation category.
Valuation and stake
At the upper level of the price band, SBI Funds Management is valued at around Rs 1.17 lakh crore in terms of market capitalisation. SBI will sell up to 12,83,34,397 shares through this offer, which is 6.3 percent of the paid-up equity share capital of SBI Funds Management. Amundi India Holding will sell up to 7,53,74,842 shares, which is 3.7 percent of the paid-up equity share capital of the company.
SBI had informed the stock exchanges on March 19 that SBI Funds Management has filed its draft red herring prospectus. Filing a red herring prospectus brings the IPO closer to launch, although the offer is subject to regulatory approvals, market conditions and other factors.
SBI Funds Management is the investment manager of SBI Mutual Fund, one of India’s largest asset management businesses. For SBI, the IPO will fetch some money from its stake in the asset management subsidiary. This offer will also provide a partial exit route for Amundi India Holding.
Leave a Reply