Jana Small Finance Bank IPO : Review, Valuation, Date & GMP

Jana Small Finance Bank IPO  - Complete Overview

Established in July 2006, Jana Small Finance Bank has been helping individuals and businesses in India achieve their financial goals. They offer a wide range of secured and unsecured loans for various needs:

• Businesses: Get loans to start or grow your small business (MSME), farm, or other venture.

• Homes: Build, buy, or repair your dream home with their affordable housing loans.

• Emergencies & Education: Personal bills, medical expenses, or education costs can be covered with their personal loans.

• Gold Loans: Access quick cash by leveraging the value of your gold jewellery.

Jana Small Finance Bank believes in financial inclusion for all. They've grown rapidly, opening over 750 branches across 22 states, including rural areas. This means you can easily access their services, no matter where you live.

Since 2008, the bank has served nearly 12 million customers, with over 4.5 million active customers as of March 31, 2023. With employing a permanent staff of 18,184.

 

Jana Small Finance Bank IPO Overview

Jana Small Finance Bank IPO date is slated to be open for subscription from February 7, 2024, to February 9, 2024. This BSE NSE IPO follows a Book Built Issue IPO.

Jana Small Finance Bank IPO price is fixed at Rs.393 - Rs.494 per share. 

The total issue size of this IPO amounts to Rs.570.00 CR. The company has reserved 50% for institutional investors, 15% for non-institutional investors, and 35% for retail investors. 

 

Jana Small Finance Bank IPO timetable (Tentative)

Events	Date
IPO Opening Date	7 February 2024
IPO Closing Date	9 February 2024
IPO Allotment Date	12 February 2024
Refund initiation	13 February 2024
IPO Listing Date	14 February 2024

 

Jana Small Finance Bank IPO Details 

IPO Opening & Closing Date	7 February to 9 February2024
Face value	Rs. 10 per share
Issue Price	Rs.393 - Rs.494 per share
Lot Size	36 Shares
Price of 1 lot	Rs. 14,904
Total Issue Size	13,768,049 shares (aggregating up to Rs.570.00 CR)
Offer for sale	2,608,629 shares of Rs.10 (aggregating up to Rs.108.00 CR)
Fresh issue	11,159,420 shares (aggregating up to Rs.462.00 CR)
Listing at	BSE NSE
Issue Type	Book Built Issue IPO
Registrar	Kfin Technologies Limited

 

Jana Small Finance Bank IPO Lot Details

Application	Lot	Shares	Amount
Minimum Lot Investment (Retail)	1 lot	36	Rs.14,904
Maximum Lot Investment (Retail)	13 lot	468	Rs.1,93,752
Minimum Lot Investment (HNI)	14 lot	504	Rs.2,08,656
Maximum Lot Investment (HNI)	67 lot	2,412	Rs.9,98,568

 

 

 

Jana Small Finance Bank IPO Reservation

QIB Shares Offered	Maximum 50%
Retail Shares Offered	Minimum 35%
Other Shares Offered	Minimum 15%

 

Company Financial

Jana Small Finance Bank's financials for FY 23 shows growth compared to the previous financial year (FY 22).

(Amount in Crore)

Period	Sep 30, FY 23	Mar 31, FY 23	Mar 31, FY 22
Total Assets	28,105.87	25,643.69	20,188.71
Total Revenue	2,215.57	3,699.88	3,062.37
PAT	213.22	255.97	17.47
Net worth	2,547.11	1,777.07	1,184.56
Reserve & Surplus	2,225.44	1,472.28	999.29
Total Borrowings	5,313.54	6,277.46	4,509.83

Location of their Banking Outlets

Jana Small Finance Bank has a majority of banking outlets in metro areas while semi-urban and rural areas contribute smaller percentages.

(in % age)

Particulars	Sep 30, FY 23	Mar 31, FY 23	Mar 31, FY 22
Metro	60.81%	61.50%	64.10%
Urban	35.09%	34.18%	31.10%
Semi Urban	3.62%	3.81%	0.41%
Rural	0.48%	0.51%	0.41%
Total	100.00%	100.00%	100.00%

 

Comparing Net Interest Margins With Peers

Jana Small Finance Bank's net interest margins (NIMs) for FY 23 compare favorably with peers, showcasing a consistent growth trend over the previous financial year.

(in % age)

Particulars	Sep 30, FY 23	Mar 31, FY 23	Mar 31, FY 22
Jana Small Finance Bank Limited	7.78%	7.73%	7.32%
Au Small Finance Bank Ltd	5.60%	5.56%	5.36%
Equitas Small Finance Bank Limited	8.43%	8.22%	7.89%
Ujjivan Small Finance Bank Limited	8.80%	9.48%	8.07%
Suryoday Small Finance Bank Limited	9.40%	8.28%	7.85%
Bandhan Bank Ltd.	7.20%	6.29%	6.87%
Credit Access Grameen Limited	13.10%	10.75%	9.72%
Spandana Sphoorthy Financial Limited	14.10%	9.96%	12.12%
Fusion Microfinance Limited	11.10%	11.50%	8.66%
Utkarsh Small Finance Bank Limited	-	9.57%	8.75%
ESAF Small Finance Bank Limited	-	9.68%	7.64%
Fincare Small Finance Bank Limited	-	9.33%	9.28%

 

Revenue By Banking Segments

Jana Small Finance Banks FY 23 revenue shows growth from diverse segments compared to FY 22.

(Amount in Crore)

Particulars	Sep 30, FY 23	Mar 31, FY 23	Mar 31, FY 22
(A) Treasury	5,86.48	10,96.84	13,71.26
(B) Corporate/Wholesale Banking	1,08.04	1,55.25	1,29.14
(C) Retail Banking	27,57.81	45,71.18	38,18.57
(D) Other Banking Operations	51.27	33.17	28.60
Total (A+B+C+D)	35,03.61	58,56.45	53,47.59

 

 

 

The Objective of the Issue

The company intends to use the net proceeds for the following objectives.

• Meeting the bank's needs for growth and expansion.

• Following RBI regulations for a stronger capital base.

 

Promoters and Management of Jana Small Finance Bank IPO

1. Jana Capital Limited

2. Jana Holdings Limited

Pre-issue Promoter Shareholding	25.20%
Post-issue Promoter Shareholding

 

Jana Small Finance Bank IPO Lead Managers

• Axis Capital Limited

• ICICI Securities Limited

• SBI Capital Markets Limited

 

Peers of Jana Small Finance Bank IPO

Jana Small Finance Bank IPO is competitively valued with a favourable P/E and EPS compared to peers.

Name of the Company	Face Value (Rs. per Share)	P/ E	EP (Basic) (Rs.)
Jana Small Finance Bank Limited	10.00	8.72	47.47
Au Small Finance Bank Ltd	10.00	35.47	21.86
Suryoday Small Finance Bank Limited	10.00	24.21	7.32
Creditaccess Grameen Ltd	10.00	32.66	52.04
Spandana Sphoorty Financial Ltd	10.00	665.52	1.74
Bandhan Bank Ltd	10.00	16.87	13.62
Ujjivan Financial Services Ltd	10.00	10.15	5.88
Equitas Small Finance Bank Limited	10.00	24.21	4.71
Fusion MicroFinance Ltd	10.00	14.68	43.29
Utkarsh Small Finance Bank Limited	10.00	13.51	4.52

 

 

 

Evaluation

The IPO is priced within the range of Rs.393 to Rs.414 per share.

 

Evaluation of P/E Ratio:

- Considering the FY23 EPS of Rs 47.47 from the last year, the resulting P/E ratio is 8.72x.

- Taking into account the weighted EPS of Rs 27.25 for the last three years, the P/E ratio amounts to 15.20x.

    

Comparative Analysis with Listed Peers:

- Spandana Sphoorty Financial Limited has a P/E ratio of 665.52x (the highest).

- Ujjivan Small Finance Bank Limited has a P/E ratio of 10.15x (the lowest).

- The industry's average P/E is 93.03x.

 

As a result, the IPO price range, with a P/E ratio ranging from 8.72x to 15.20x, will be considered highly undervalued in comparison to the industry average of 93.03x.

 

Dividend Policy

The company hasn't paid dividends in past fiscal years. Whether we can pay them in the future depends on factors like profits, past dividend trends, capital needs, legal restrictions, and other relevant considerations evaluated by our Board.

 

IPO's Strengths

- Company has seen significant growth in loans and deposits.

- Ranked fourth in size among Small Finance Banks.

- Provides digitalized services with a customer-focused approach.

- Strong risk management and experienced leadership.

- Presence across India with a well-recognized brand.

- Restrictions on Equity Shares may pose challenges for the bank.

 

IPO's Weaknesses

- High credit risk due to unsecured loans.

- Legal issues may impact the business negatively.

- Loss of expected income if customers move their loans.

- Regulatory inspections and non-compliance could affect the business.

 

IPO GMP Today

The Latest GMP of Jana Small Finance Bank IPO is Rs.16.

 

 

 

Conclusion

Jana Small Finance Bank, established in 2006, has shown consistent growth in providing financial services to individuals and businesses across India. The IPO, scheduled from February 7 to February 9, 2024, offers shares at a price range of Rs.393 to Rs.494 per share. The company's financials, strategic positioning, and growth trajectory make it an interesting prospect for investors. However, potential risks and regulatory challenges should be carefully considered before making investment decisions.

 

Finowings IPO Analysis

Hope you enjoyed the Finowings IPO Analysis. We tried our best to give every required detail about the company that you should know before applying to the IPO. 

You must consult your financial advisor before making any financial decisions. 

To Apply for the IPO, Click Here.

 

To Read the Prospectus of the Company Click Here to Download the DRHP.

 

 

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