FEDBANK FINANCIAL SERVICES LIMITED

FEDBANK FINANCIAL SERVICES LIMITED- IPO DETAILS 

Company Overview 

Fedbank, a non-banking finance company (NBFC) affiliated with The Federal Bank Limited, focuses on retail services. In FY23, it boasts the second lowest borrowing costs in India among its peers in micro, small, and medium enterprises (MSMEs), as well as the gold loan and MSME & gold loan sectors. The company provides a diverse range of products, including mortgage loans such as housing loans, small and medium ticket loans against property (LAP), unsecured business loans, and gold loans.  

Utilizing a Phygital doorstep model, Fedbank Financial Services seamlessly integrates digital and physical initiatives to deliver personalized services across all product lines. With a robust presence in the Southern and Western regions, the company operates through 575 branches across 191 districts in 16 states and union territories, including Andhra Pradesh (including Telangana) and Rajasthan. 

Objective of the IPO 

Here are a few quick reasons why company is going public:  

1. Strengthening the company's Tier I capital base to address upcoming capital needs resulting from business and asset growth. 

2. Covering incurred offer expenses. 

Company Financials 

Key Performance Indicator 

Pros 

1. The company's extensive presence across contiguous states facilitates the diversification of its exposure across local micro markets, enabling an expansion into underpenetrated markets. 

2. Informed by a deep understanding of customer environments, finances, and unique circumstances, the company exhibits robust credit decision-making capabilities, reinforcing its strong underwriting and risk management practices. 

3. The company's growth is significantly driven by a diversified portfolio. To fortify its financial position, the company plans to explore new sources and pools of capital, diversify funding channels, and implement effective asset liability management policies. 

4. Utilizing digital infrastructure within its systems, the company operates a scalable and sustainable model. This approach empowers the company to expand its reach, scale its operations, and foster revenue growth with lower incremental costs. 

Cons 

1. The company's operational stability hinges on its ability to procure funds promptly and cost-effectively. Any disruption in funding sources could have adverse effects on the business. 

2. The company exhibits a significant concentration of loans toward emerging self-employed individuals ("ESEI") and micro, small, and medium enterprises ("MSME"). Defaults from these borrowers could have adverse implications for the business. 

3. Given that the company's operations heavily rely on interest income, any volatility in interest rates could impact both lending and treasury operations, consequently affecting overall business operations. 

How to Apply for this IPO 

1. Go to https://ipo.adityatrading.in/ 

2. Enter your Client ID 

3. Enter the OTP received in your registered mobile number. 

4. Choose the IPO and click on apply button. 

5. Enter the UPI ID, Quantity, and Cut off the price. 

6. Click on submit button 

7. Confirm the mandate request received on your phone by entering the UPI Pin. 

You can also watch our youtube video on “How to Apply on IPO” by clicking on the link “https://www.youtube.com/watch?v=1qOI8dCpl1I&ab_channel=ATS”