IPO Update: Spandana Sphoorty IPO to hit market next week

The IPO of the microfinance company opens for subscription on August 5. The price band for the offer is set at Rs. 853 to Rs. 856 per share.

Initial Public Offering of Spandana Sphoorty includes offer for sales of approximately 93,56,725 equity shares from selling shareholders and a fresh issue of equity share aggregating to Rs. 400 crore, as per the company's Red Herring Prospectus filed with the exchanges. The selling shareholders comprise, corporate promoter Kangchenjunga Limited offloading 59,67,097 shares; followed by individual promoter Padmaja Gangireddy selling 14,23,114 shares, who is the founder of the company; Vijaya Siva Rami Reddy selling 7,96,509 shares, Valiant Mauritius 7,83,747 shares; Helion II 1,32,831 shares; Kedaara Capital 1,29,732 shares and Helion 1,23,695 shares.

Pre-IPO, Kedaara Capital is the largest shareholder of Spandana Sphoorty with more than 60 per cent stake and Padmaja Reddy owns 20 per cent.

Spandana is a public limited company recognised as an NBFC-MFI with the Reserve Bank of India (RBI). Started in 1998, Spandana is today, among the largest microfinance institution (MFI) in India. Spandana had 694 branches with presence in 15 states with a Gross Loan Portfolio of Rs. 3,166 crore, as of March 2018. For the year ended March FY19, the company's revenue from operations was at Rs. 10,362.81 million as compared to Rs. 5,872.74 million at March 31, FY18. PAT for the FY19 was at Rs. 1,879.71 million as per Ind AS standards.

The company plans to use the net proceeds of the fresh issue for augmenting its capital base to meet future capital requirements, while all proceeds from the offer for sale will go to each of the selling shareholders, respectively.

The IPO closes on Wednesday, August 7.