Fedbank Financial Services (FFSL), which is the promoted arm of Federal Bank, has filed its Draft Red Herring Prospectus (DRHP) with market regulator Securities and Exchange Board of India (SEBI).
The company plans to raise funds through an offer of equity shares (face value of Rs. 10 each) comprising fresh issue aggregating up to Rs. 7,500 million and an offer for sale aggregating up to 70,323,408 equity shares by promoter shareholder and other shareholder.
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The offer for sale up to 70,323,408 equity shares comprises of up to 16,497,973 equity shares by The Federal Bank Limited and and up to 53,825,435 equity shares by True North Fund VI LLP.
FFSL plans to utilise the funds augmenting Tier – I capital base to meet its future capital requirements, arising out of the growth of business and assets. A part of the proceeds from the Fresh Issue will be used towards meeting Offer Expenses, the company said.
ICICI Securities Ltd, BNP Paribas, Equirus Capital Private Limited, and JM Financial Limited are the Book Running Lead Managers to the Issue.
Federal Bank arm Fedfina is one of five NBFCs in India that have been supported by private banks. It concentrates on providing services to emerging sectors of self-employed people and Micro, Small & Medium Enterprises (MSMEs).
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According to a research report by Crisil, Federal Bank arm Fedfina had the third-fastest AUM growth among NBFCs in its peer group in India, with a three-year CAGR of 33% between Fiscals 2020 and 2023, as of March 31, 2023.
The company had filed its draft papers last year as well, however, pulled out of it as it found the market conditions unfavourable. It is now reconsidering capital raising options after the lapse of earlier received regulatory approval.