Fino Payments Bank Limited (FPBL) has filed draft red herring prospectus (DRHP) with SEBI, seeking regulatory approvals for launching its IPO. Â As per market sources, the Fino Payments Bank IPO size is likely to be of INR1,300 crores. The issue includes a fresh issue of INR 300 crore as well as an OFS component.
Backed by Blackstone, ICICI Group, BPCL, and IFC, the company started operations as a payments bank four years ago. The company – a subsidiary of Fino Paytech Limited (FPL) – is a scheduled commercial bank serving the emerging India market with a clear focus on digital financial services. The fintech company offers a diverse range of financial products and services that are primarily digital and have a payments focus.
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Over the last few years, Fino Payments Bank has witnessed a steep growth in transaction volumes amid growing digitization and rising proliferation of its banking points. Since 2017, it has grown its presence to cover over 94% of districts as of 31 March 2021. According to the draft prospectus, the payment bank’s platform facilitated more than 434 million transactions having a gross transaction value of INR1.32 lakh crores in FY21.
It has a strong leadership position in the fintech industry having the largest network of micro ATMs as of March 2021 with a market share of 55%, a robust merchant network of 6.4 lakhs and 25.7 lakh bank accounts.
Fino Payments Bank IPO – Profitable operations
The payments bank is among the few fintechs in India which are profitable. Fino became profitable during the fourth quarter of FY20 and has consistently enhanced its profitability since. This puts Fino Payments Bank among the first profitable fintech to file for an IPO.
While uncertainties were looming over financial sector amid covid-19 pandemic, the company’s unique business model and reliance on digital services allowed it to grow and thrive. Its revenue for FY21 stood at INR791 crores that grew at a CAGR of 29% in last three years. The bank registered a profit of INR20.5 crores in FY21 with an annual average ROE of 15%, the DRHP revealed. All these factors make Fino Bank IPO an offer to watch out for.
Investment bankers appointed to Fino Bank IPO are Axis Capital, CLSA India, ICICI Securities and Nomura Financial Advisory Services.
