Four years after starting operations as a payments bank, Blackstone, ICICI Group and BPCL backed Fino Payments Bank Limited (FPBL) has filed the draft documents with SEBI for an IPO. As per market sources, the IPO size is likely to be of ₹1,300 crores. The issue includes a fresh issue of ₹ 300 cr as well as an OFS component.
FPBL is a scheduled commercial bank serving the emerging India market with its digital based financial services. The company is a fully owned subsidiary of Fino Paytech Limited (FPL), a pioneer in technology enabled financial inclusion solutions. FPL is backed by marquee investors like Blackstone, ICICI Group, Bharat Petroleum and IFC, amongst others.
The fintech bank turned profitable in the fourth quarter of FY20 and has consistently enhanced its profitability since. This makes FPBL the first profitable fintech to file for an IPO.
Over the last few years, FPBL has witnessed a steep surge in transaction volumes on the back of digitization and proliferation of its banking points. As stated in the DRHP, in FY21 the payment bank's platform has facilitated more than 434 million transactions having a gross transaction value of Rs 1.32 lakh crores. It has a strong leadership position in the fintech industry having the largest network of micro ATMs as of March 2021 with a market share of 55%, a robust merchant network of 6.4 lakhs and 25.7 lakh bank accounts.
Digital based transaction focused approach with no credit risk have enabled the growth of FPBL in times wherein the financial sector was looming over challenges. Its revenue for FY21 stood at ₹791 crores that grew at a CAGR of 29% in the last three years. The bank registered a profit of ₹20.5 crores in FY21 with an annual average ROE of 15%, the DRHP states.
Investment bankers appointed to the issue are Axis Capital Ltd, CLSA India Pvt Ltd, ICICI Securities Ltd and Nomura Financial Advisory Services Pvt Ltd.