Chennai-headquartered Repco Home Finance, housing finance subsidiary of Repco Bank, a Government of India owned cooperative bank, is planning to raise up to Rs 270.04 crore through an initial public offering (IPO), to support its growth. The price band will be between Rs 165 and Rs 172 a share.
The company will net Rs 259.05 crore at the lower end and Rs 270.04 crore at the upper end of the price band.
The IPO will open on Wednesday and close on March 15.
SBI Capital Markets, IDFC Capital, and JM Financial Institutional Securities are the merchant bankers (intermediaries involved in helping the company raise money from the public) to the issue.
Karvy Computershare Pvt Ltd is the registrar. Private equity firm Carlyle Group held 23.75 per cent stake in the company at the time of filing the issue documents.
Repco Home Finance plans to grow 30 per cent year-on-year for the next three years.
“We are focusing on tier-II and tier-III centres for growth and our strategy will be the same for the coming years,” said R Varadarajan, managing director, Repco Home Finance. According to the National Housing Bank - the regulator for home financiers - the housing finance industry is expected to grow by 18 per cent in the current financial year.
Tier-II and tier-III markets are attractive as they are largely under-served by banks and housing finance companies, said Varadarajan.
Repco’s capital adequacy ratio is high at 15.94 per cent. Its outstanding loan portfolio has grown at a compounded annual growth rate of 43.81 per cent in the past four years to reach Rs 2,802 crore as of March 2012, while its net non-performing asset ratio stood at 1.60 per cent as of September 2012. The firm had reported a net profit of Rs 35.6 crore at the end of the September quarter.