SKS Microfinance IPO subscribed 13.37 times

Gets bids for 18.41 crore shares

The initial public offer (IPO) of Hyderabad-based microfinance firm SKS Microfinance was subscribed 13.37 times by 16:00 IST on the last day of the issue today, 2 August 2010. The IPO garnered bids for 18.41 crore shares.



Bidding for the qualified institutional bidders (QIBs) category in the SKS Microfinance IPO had concluded on Friday, 30 July 2010. The QIBs had made a beeline for the IPO with the portion reserved for them getting subscribed 20.38 times. Bids were put in for 14.37 crore shares as against 70.52 lakh shares reversed for QIBs. Within the QIB category, foreign institutional investors (FIIs) put in bids for 10.67 crore shares

Domestic institutional investors (DIIs) other than mutual funds put in bids for 3.08 crore shares. Mutual funds have put in bids for 61.30 lakh shares.

The price band for the IPO is Rs 850-985 per share. Ratings firm CARE has assigned an IPO Grade 4 to SKS Microfinance IPO, indicating above average fundamentals.

The company has proposed to offer a discount of Rs 50 per share to retail investors on the final issue price.

The company intends to utilize the net proceeds of the IPO to augment its capital base to meet its future capital requirements arising out of growth in the business.

On 28 July 2010, SKS Microfinance raised Rs 298 crore from 36 anchor investors. The company has finalized the allotment of about 30.20 lakh shares to anchor investors at Rs 985 per share -- the top end of the Rs 850-985 price band for its IPO.

SKS Microfinance is India's largest microfinance company in terms of total value of loans outstanding, number of borrowers and number of branches. It is engaged in providing microfinance services to individuals from poor segments of rural India.

Gross revenue of the SKS Microfinance grew at a CAGR of 176% in last 4 years ended March 2010 while net profit rose at a CAGR of 223% over the same period.