Jana SFB lists at discount

Jana Small Finance Bank is the new listing today and it reflected the lacklustre mood of the market. As against the IPO price of Rs.414, it got listed on the BSE at Rs.396 and is currently trading at Rs.395 levels.

This is a micro finance institution (MFI) in its previous avatar, Jana SFB has gross advances of Rs. 21,347 cr, as of 30.9.23, split 22% in micro finance loans, 18% loan against property, 17% agri loans, 15% MSME loans and 14% affordable housing loans. Its loan book is geographically diversified, with top 3 states – Maharashtra, Karnataka and Tamil Nadu accounting for just 38% combined.

The IPO was overall subscribed 18.5x, with QIBs portion at 38.75x, HNIs at 18.5x and Retail Investors at 5.46x.

In our IPO Analysis, we had concluded - stock does not qualify as a portfolio play, given selling overhand of sizeable stake by the investors and business operating at lower margin and poorer asset quality vis-à-vis some peers.