Esaf Small Finance Bank Ltd has received final observation from Securities and Exchange Board of India (SEBI) to raise funds through an initial public offering (IPO).

The company had re-filed preliminary IPO papers with SEBI in July 2023. The IPO includes a fresh issue up to ₹486.74 crore and an offer for sale of up to ₹142.30 crore by Promoter and other selling shareholders.

The offer for sale comprises of up to ₹119.26 crore by Esaf Financial Holdings Private Limited, up to ₹12.67 crore by PNB MetLife India Insurance Company Limited, up to ₹10.37 crore by Bajaj Allianz Life Insurance Company Limited.

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The company, in consultation with the lead bankers to the issue, may consider a further issue of equity shares by a private placement or any other method aggregating up to ₹97.33 crore (“Pre- IPO Placement”). If such placement is completed, the fresh issue size will be reduced.

According to the DRHP, the proceeds from the fresh issue will be used towards augmenting the bank’s Tier– I capital base to meet its future capital requirements.

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The bank has an extensive network of 700 banking outlets (including 59 business correspondent- operated banking outlets), 743 customer service centers (operated by their business correspondents), 20 business correspondents, 2,023 banking agents, 481 business facilitators, and 528 ATMs spread across 21 states and two union territories, serving a customer base of 6.83 million as of March 31, 2023.

ICICI Securities Limited, DAM Capital Advisors Limited and Nuvama Wealth Management Limited (formerly known as Edelweiss Securities Limited) are the book running lead managers and Link Intime India Private Limited is the registrar to the offer. The equity shares are proposed to be listed on BSE and NSE.

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