The second-largest credit card provider in India – SBI Cards and Payment Services Ltd, the credit card subsidiary of State Bank of India (SBI), filed plans for an initial public offering (IPO) with the markets regulator SEBI and stock exchanges on November 26? 2019.
The share sale is poised to become the fifth largest IPO in the country after Coal India Ltd, Reliance Power Ltd, GIC Re, and ONGC. This could be the biggest IPO of the financial year 2019-20 if the SBI Cards get a go-ahead from SEBI. The company is looking to list within the next 3-4 months at a pre-money valuation of ?65,000 crore.
SBI, which holds 74% stake in the unit, along with private equity firm Carlyle Group, which holds the rest 26% through its subsidiary CA Rover Holdings, will together sell 13,05,26,798 equity shares through the IPO. The issue consists of fresh issue of Rs 500 crore.
Of the total offer for sale, SBI will sell up to 3,72,93,371 equity shares and CA Rover up to 9,32,33,427 equity shares through IPO. While Carlyle is looking to sell 10% stake via the IPO, SBI would sell 4% stake in the company.
The company would use fresh issue proceeds towards augmenting capital base to meet future capital requirements.
For the six months to September, SBI Cards reported a revenue jump of 36% to ?4,363.9 crore from a year ago. Its profit jumped 78% to ?1,034.58 crore during the period.
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