Fedbank Financial Services share see a weak debut. List 1.61% lower at Rs137.75

Fedbank Financial Services shares were trading at ₹133.55, 4.61% lower than tghe issue price and 3.15% lower than the listing price.

Fedbank Financial Services IPO had opened for subscription from Wednesday, November 22, and closed on Friday, November 24.

Fedbank Financial Services IPO price band had been fixed in the range of ₹133 to ₹140 per equity share of face value of ₹10.

The Grey market premium or the GMP for stood at +5 on the day of opening of IPO. This had indicated that FedBank Financial Services share prices were trading at a premium of Rs5 in the grey market. The GMP however, thereafter had drifted lower to   ₹0 per share according to investorgain.com. This indicated that market participants were anticipating listing of the Fedbank Financial Services IPO at the upper end of the IPO price band at Rs140 apiece without any premium.

Also Read Fedbank Financial Services IPO listing date today. Check what GMP, experts signal on share debut

Fedbank Financial Services IPO was subscribed 2.24 times. The public issue subscribed 1.88 times in the retail category, 3.48 times in QIB, and 1.49 times in the NII category by November 24, 2023 (Day 3).

Federal Bank arm Fedbank financial Services IPO comprised of fresh issue of equity shares up to the value of ₹600 crore and an offer-for-sale (OFS) of up to 35,161,723 equity shares by the promoters selling shareholders and promoter group make up the offer, which has a face value of ₹10 per equity share, as per RHP.

The Federal Bank Limited is the promoter of Fedbank Financial Services, a non-banking finance company (NBFC) with retail in focus. According to the CRISIL Report, in the fiscal year 2023 and the three months ending on June 30, 2023, Fedbank Financial Services had the second and third lowest cost of borrowing among the micro, small, and medium-sized enterprises (MSMEs) gold loan and MSME & gold loan peer set in India.

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Based on the CRISIL Report, as of March 31, 2023, the NBFC ranked third among NBFCs in the Indian peer set for assets under management (AUM) growth, with a three-year compound annual growth rate (CAGR) of 33% between Fiscals 2020 and 2023, and the fourth fastest year-over-year AUM growth of 42% for the three months ending June 30, 2023.

The NBFC’s listed industry peers are Aptus Value Housing (with P/E of 28.58), IIFL Finance(with P/E of 15.53), Five Star Business Finance (with P/E of 37.54), Manappuram Finance Limited (with P/E of 8.06), Muthoot Finance Limited (with P/E of 15.39), SBFC Finance Limited (with P/E of 48.33), according to Red Herring Prospectus (RHP).