Finance
Jana Small Finance Bank refiles draft papers with Sebi to launch its IPO
Jana Small Finance Bank has filed its draft red herring prospectus (DRHP) with market regulator Securities and Exchange Board of India (Sebi) to launch funds through an initial public offering (IPO). The company is looking to raise Rs 575 crore through the sale of fresh equity shares.
The issue also includes an offer-for-sale (OFS) aggregating up to 4.05 million equity shares by Investor shareholders including Client Rosehill, CVCIGP II Employee Rosehill, Global Impact Funds, Growth Partnership II Ajay Tandon CoInvestment Trust, Growth Partnership II Siva Shankar CoInvestment Trust and Hero Enterprise Partner Ventures.
The net proceeds from the fresh issue are proposed to be utilised towards augmentation of Bank’s Tier – I capital base, to meet future capital requirements such as organic growth and expansion and to comply with the regulatory requirements, along with general corporate purposes. Proceeds from the fresh stake sale will go to selling shareholders.
The bank, in consultation with the lead managers, can consider a pre-IPO share allotment not exceeding Rs 115 crore. In such case, the fresh issue size will be slashed. According to Fitch Report, Jana Small Finance Bank Limited is fourth largest small finance Bank in terms of AUM and the fourth largest small finance bank in terms of deposit size as at March 31, 2023.
As at March 31, 2023, Jana Small Finance had 754 banking outlets, including 272 banking outlets in unbanked rural centres, in 22 states and two union territories. As of March 31, 2023 Jana Small Finance Bank has served nearly 1.2 crore customers since 2008, including 45.7 lakh active customers.
The lender will allocate 50 per cent of shares to the qualified institutional bidders, while non-institutional investors will get 15 per cent of allocations. Remaining 35 per cent of shares shall be allocated towards the retail investors.
Axis Capital, ICICI Securities and SBI Capital Markets are the book-running lead managers to the issue, while KFin Technologies has been appointed as the registrar.
The lender commenced operations as a small finance bank in March 2018. In April 2021, Jana filed for an IPO but had to delay its fundraising plan due to the pandemic. The Reserve Bank of (RBI) India mandates that all small finance banks have to list within five years of starting operations.
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While most of the CDFI fund appears to be protected by Congress, Hinkle Brown said he’s concerned that the rules won’t apply.
“It’s unclear what overzealous implementation in this regard would look like,” he said. “If they eviscerate and make non-functional the CDFI fund there’s a lot of costs, the Philly region will suffer.”
It could put a dent in regional economic development efforts in low income communities, said Leslie Benoliel, CEO of Entrepreneur Works in Philadelphia.
“[Community Development Financial Institutions] are like the capillaries of the financial distribution system in our country. And if you cut off the blood flow to those extremities, that will cause enormous harm,” Benoliel said.
Small business owners who may not typically trust the banking system or government often will work one-on-one with a community organization, she said.
CDFIs across Pennsylvania were allocated $32 million under financial assistance, healthy foods and persistent poverty county financial assistance awards last year.
If there’s no federal support, local nonprofits will likely have to raise money another way, said Varsovia Fernandez, CEO of the Pennsylvania CDFI Network.
“There is a possibility of moving to a fee for services model where small businesses need to pay to receive technical assistance education and I would imagine [loans would have] a higher rate to be sustainable,” she said. “I am hoping that it’s not a drastic change what the White House ends up doing.”
On March 17, U.S. Treasury Secretary Scott Bessent said in a statement that the Trump administration understands the significance of the federal fund and local community lending organizations.
“CDFIs [Community Development Financial Institutions] are a key component of President Trump’s commitment to supporting Main Street America in the pursuit of job growth, wealth creation and prosperity,” Bessent said.
Finance
Stock market today: Dow, S&P 500, Nasdaq futures rise in search for another bounce-back week
US stock futures rose Sunday, as the major indexes looked for another week of gains toward the end of a rough month and quarter.
Futures attached to the benchmark S&P 500 (ES=F) rose 0.6%, with Nasdaq 100 (NQ=F) futures up 0.7%. Futures tied to the Dow Jones Industrial Average (YM=F) advanced around 0.4%.
As of 9:22:10 PM EDT. Market Open.
ES=F YM=F NQ=F
Tariffs continue to demand investor attention, as the April 2 deadline approaches for President Trump to enact reciprocal duties. Trump indicated on Friday that he is maintaining “flexibility” in relation to the tariffs’ rollout, but he hasn’t given a firm idea of what that would look like.
Other concerns for Wall Street include considerations over whether the year-to-date losses have only been a slowdown blip — or if the economy is heading into a recession. JPMorgan strategist Bruch Kasman, for one, pegs the chance of recession as high as 40%.
On the earnings front, quarterly results from Lululemon (LULU), Gamestop (GME), and Dollar Tree (DLTR) are all due this week amid a slower week of financial releases.
Looking at economic data for the week to come, a reading of the Fed’s preferred inflation gauge, the Personal Consumption Expenditures Index, is due Friday. The PCE comes alongside a treading of the University of Michigan’s consumer confidence survey, as well as updates to Purchasing Managers’ Indexes for the manufacturing and services sectors.
Coming soon
Stock market coverage for Monday, March 25, 2025.
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