SBI Cards IPO elicits strong investor response; gets subscribed over 22 times

Eliciting a robust response, the initial share sale of SBI Cards and Payment Services was subscribed 22.45 times on the final day of bidding on Thursday even as the broader market sentiment remained at a low ebb on coronavirus concerns. The Initial Public Offer (IPO) of SBI Cards, part of the country's largest public-sector lender SBI, is also one of the largest share sales in recent times, both in terms of size and oversubscription.

More than 225 crore bids were received for the offer worth Rs 10,355 crore. A total of 10 crore shares were up for bidding, as per NSE data till 1830 hrs. Non-institutional investors category was subscribed 45 times and retail individual investors 2.5 times, according to merchant banking sources.

Sources said there was a blockbuster response to SBI Cards IPO despite challenging market conditions and that the offer has been subscribed more than 26 times. For Qualified Institutional Buyers (QIB), the issue closed on Wednesday and for all other bidders, it closed on Thursday.

The QIB category was subscribed 57.18 times, as per the NSE data. The offer comprised a fresh issue of shares worth Rs 500 crore and an offer-for-sale of 13,05,26,798 shares, including anchor portion of 3,66,69,589 shares. At the upper end of the Rs 750-755 apiece price band, the sale would fetch Rs 10,355 crore.

SBI Cards IPO is among the largest in terms of oversubscription value in at least 12 years. The initial share sales of Reliance Power and Coal India had attracted more interest during this period. Over 37 lakh applications were received for SBI Cards offer, generating demand to the tune of Rs 2 lakh crore, the sources said.

The company had raised Rs 2,769 crore from 74 anchor investors on February 29. Currently, State Bank of India (SBI) holds 76 per cent stake in SBI Cards while the rest is with Carlyle Group. Kotak Mahindra Capital Company, Axis Capital, DSP Merrill Lynch, HSBC Securities and Capital Markets (India), Nomura Financial Advisory and Securities (India) and SBI Capital Markets are the managers to the offer.