Big news on SBI card IPO, price range may be Rs 750-755

HIGHLIGHTS: SBI Card IPO opens on March 2. Investors have high expectations from this IPO. According to bankers, this IPO can be offered in the price range of Rs 750-755.

There is a big news for investors hoping for bumper profits from SBI Card IPO. The IPO of SBI Cards and Payment Services can remain in the price range of Rs 750-755. The company expects that there will be a huge demand for the IPO, which opens on March 2, in view of which it can generally be available for subscription for four days instead of three days. According to banking sources, the fourth day will be exclusively reserved for the subscription of retail investors, high net worth investors (HNIs) and shareholders of SBI.

Bidding will be done by March 5

As per the prospectus dated February 18, the company will fetch 13.05 crore shares valued at Rs 500 crore. The bidding process for the IPO will end on 5 March. The company can raise Rs 9,000-10,000 crore from this IPO.

Bid for 13 million shares

According to the DRHP filed last year, the company will bring 13,05,26,798 equity shares to the market through the offer for sale. SBI will sell 3,72,93,371 shares, while 9,32,33,427 shares will be sold by Carlyle Group (CA Rover). Apart from this, the company will also issue fresh equity shares worth Rs 500 crore. SBI holds 76 per cent stake in SBI Cards, while the rest is held by the Carlyle Group.

Expect huge profits

The stock of SBI Cards and Payments Services is trading in the gray market at a premium of Rs 200-250. Three dealers involved in such trades have given this information to ET. The value of the company can be estimated at Rs 57,000-60,000 crore for the IPO. Abhinav Khatri, MD, financial services advisory firm Vayana Wealth, said, “There is a huge demand for unlisted shares as the theme is based on the Indian consumption story. Investors feel that due to the presence of SBI Cards in certain segments, there is a huge possibility of business in it.

95 million customers of SBI card

According to an Economic Times report in November, SBI Card has around 95 lakh customers and is the second largest card issuing company after HDFC Bank. According to RBI data, credit card spending in India has increased at a rate of 35.6% annually in the last three years, while credit card dues have increased by 25.6%. The industry average for the card business is 3.5%. SBI Card's Return on Equity (RoE) has not seen less than 25% in the last 6-7 years and has averaged around 30% during this period.

Source: Web