As initially reported by MicroCapital on March 29, 2010, India’s SKS Microfinance has filed for an initial public offering, and it has recently announced that it is planning to raise INR 1,500 crore, or INR 15 billion (USD 317 million) through the IPO. The IPO is planned to commence on July 27, one day earlier than reported previously. SKS Microfinance is an Indian microfinance institution serving impoverished women which has total assets of USD 596 million at March 31, 2009.
With a price range of INR 650-700 per share (USD 14-15), the company will offer a 5-10 percent discount on the price paid by retail investors versus the price paid by institutional investors.
The company is selling16.8 million equity shares in the IPO. This includes the issue of 7.5 million of new issue shares and 9.4 million shares to be sold by existing shareholders. According to the company, none of the existing shareholders will exit the company in the offering, and they will stay locked in for next three years, post-IPO. The offering will open on July 27, and it will close on July 30 for qualified institutional investors and on August 2 for retail investors.
The pending IPO, to be offered on the Bombay Stock Exchange and the National Stock Exchange of India, will be the first public offering for an Indian microlender. SKS Microfinance had originally filed to raise up to USD 250 million in its IPO, and no further information regarding the larger target of USD 317 million has been announced.
By Jennifer Shevock, Research Associate
About SKS Microfinance:
SKS Microfinance is an Indian microlender that delivers microfinance products through a group lending model to impoverished women in India. It is a for-profit non-banking finance company which converted to a public limited company in May 2009. Equity investors include Sequoia Capital, Vinod Khosla, Small Industries Development Bank of India, Bajaj Allianz, Yatish Trading, Kismet Capital, Sandstone Capital, Silicon Valley Bank and Unitus. Its total assets as of March 31, 2009, were USD 596 million with 3.5 million active borrowers, and it reported return on assets of 3.68 percent and return on equity of 18.72 percent.
Sources and Additional Resources:
“SKS may fix IPO price band at Rs 600-Rs 700” July 20, 2010.
http://www.mydigitalfc.com/news/sks-may-fix-ipo-price-band-rs-600-rs-700-964
MICROCAPITAL BRIEF: “Upcoming Initial Public Offering (IPO) of SKS Microfinance Rated as Grade 4/5 By Credit Analysis and Research Limited (CARE Ratings)” July 19, 2010.
https://www.microcapital.org/microcapital-brief-upcoming-initial-public-offering-ipo-of-sks-microfinance-rated-as-grade-45-by-credit-analysis-and-research-limited-care-ratings/
MICROCAPITAL BRIEF: “SKS Microfinance, a Microfinance Institution (MFI) in India, Announces Intentions to Sell Shares From July 28 to July 30” July 13, 2010. https://www.microcapital.org/microcapital-brief-sks-microfinance-a-microfinance-institution-mfi-in-india-announces-intentions-to-sell-shares-from-july-28-to-july-30/
MICROCAPITAL BRIEF: “Indian Microfinance Institution SKS Microfinance Receives Initial Public Offering (IPO) Approval from Securities and Exchange Board of India” July 13, 2010.
https://www.microcapital.org/microcapital-brief-indian-microfinance-institution-sks-microfinance-receives-initial-public-offering-ipo-approval-from-securities-and-exchange-board-of-india/
MICROCAPITAL BRIEF: “India’s SKS Microfinance IPO Could Trigger Trend in Microlending” June 16, 2010. https://www.microcapital.org/microcapital-brief-indias-sks-microfinance-ipo-could-trigger-trend-in-microlending/
MICROCAPITAL BRIEF: “Initial Public Offering (IPO) of India-based Microfinance Institution (MFI) SKS Microfinance Raises Questions about Ethics within the Industry” April 13, 2010. https://www.microcapital.org/microcapital-brief-initial-public-offering-ipo-of-india-based-microfinance-institution-mfi-sks-microfinance-raises-questions-about-ethics-within-the-industry/
MICROCAPITAL BRIEF: “SKS Microfinance Limited, Microfinance Institution (MFI) in India, Files to Raise $250m in Initial Public Offering (IPO)” March 29, 2010. https://www.microcapital.org/microcapital-brief-sks-microfinance-limited-microfinance-institution-mfi-in-india-files-to-raise-250m-in-initial-public-offering-ipo/
MICROCAPITAL BRIEF: “SKS Microfinance, a Microfinance Institution (MFI) Based in India, Expected to File for Initial Public Offering (IPO) in Next Four Weeks” March 9, 2010. https://www.microcapital.org/microcapital-brief-sks-microfinance-a-microfinance-institution-mfi-based-in-india-expected-to-file-for-initial-public-offering-ipo-in-next-four-weeks/#more-4531
MICROCAPITAL STORY: “SKS Microfinance Plans for India’s First Microfinance Institution’s (MFI) Initial Public Offering (IPO), Managed by Citigroup, Credit Suisse and Kotak Mahindra Capital” October 12, 2009. https://www.microcapital.org/microcapitalorg-story-sks-microfinance-plans-for-india%E2%80%99s-first-microfinance-institution%E2%80%99s-mfi-initial-public-offering-ipo-managed-by-citigroup-credit-suisse-and-kotak-mahindra/#more-3815
MicroCapital Universe: SKS Microfinance: https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=SKS+Microfinance
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