SBI Card

SBI Cards and Payment Services IPO (SBI Cards IPO Detail) Detail

SBI Cards Business Overview

Incorporated on May 15, 1998, SBI Cards and Payment Services Limited is a subsidiary of State Bank of India (SBI) which holds 74% shares of the company. SBI is India’s largest commercial bank in terms of deposits, advances and number of branches as of September 30, 2019 according to the RBI while balance 26% shares are holded by CA Rover Holdings, an affiliate of the Carlyle Group.

Within a short span of 10 months, entered the ‘1Million Card Club’ in 2002 and crossed the 2 million card base in 2005 and today have over 9 million credit card customers, becomes 2nd largest credit card issuer in the India along with wide distribution network, Tele-Calling, E- apply and Co-Brand channels with Pan India presence.

They are the 2nd largest credit card issuer in India, with a 17.6% and 18.0% market share of the No. of credit cards as of March 31, 2019 and September 30, 2019, respectively.

SBI Card offer four primary SBI Card-branded credit cards: Simply Save, Simply Click, Prime and Elite, each catering to a varying set of cardholder needs. According to CRISIL report they are largest Co-brand card issuer and have partnership with Air India, Apollo Hospitals, BPCL, Etihad Guest, Fbb, IRCTC, OLA Money and Yatra, among others.

SBI Card have partnership with Visa, MasterCard and RuPay payment networks.

Company has special focus on product development & Corporate Segment and through its campaign “Project Shikhar’ started in Oct’17 company is offering Pre-approved offers to customers which is going very well.

Competitive Strengths of SBI Card

  • 2nd largest credit card issuer in India with deep industry expertise and a strong track record of growth and profitability
  • Diversified customer acquisition capabilities
  • Diversified portfolio of credit card offerings.
  • Extensive use of Technology with industries finest data analytics capabilities.
  • Experienced and professional staff.

SBI Card Promoter

The promoter of Company is SBI and it currently holds (along with its nominees) 689,927,363 Equity Shares, constituting to 74.00 % of the pre-Offer issued, subscribed and paid-up Equity Share capital of Company.

Partnership with SBI enables them to market their credit cards to SBI’s customer base out of over 22,000 SBI branches across India.

Registered Office

Unit 401 & 402,4th Floor, Aggarwal Millennium Tower E 1, 2, 3, Netaji Subhash Place, Wazirpur New Delhi – 110034 India

Opportunities

  • Payment trend are shifting from cash to digital; digital payments reached to 8% in FY’17 vs 2% in FY’08.
  • Credit Acceptance is growing in India, Retail Credit is growing at 11% CAGR.
  • E Commerce market expected to reach by $100 Bn by 2020, growing at 53% CAGR.
  • Government has now waived MDR on debit card payments on POS machines.
  • Government is pushing for electronic payments in its policies and even procurement.
  • Credit Bureau coverage is increasing ; 45% coverage in 2017; 3x growth in bureau check.

Threats

  • Govt push to UPI.
  • New Players entry into market.
  • Over leveraging of same customer by multiple issuers.

Draft Red hearing Prospectus of SBI Card IPO

Click to Download the DRHP of SBI Card IPO : DRHP

Financial Summary : SBI Card IPO

Fig in ‘Cr.’
 Sep’19Mar’19Mar’18
Interest Income (A)2211.563575.712759.98
Finance Cost (B)621.321017.21711.51
Net Interest Income (A-B)1590.242558.52048.47
Growth 20%34%
    
Total Revenue4677.217286.835370.19
Profit After Tax (PAT)725.88862.72601.14
Growth 30%38%

Objects of the Issue

  • To meet the capital requirements of the company.
  • To meet the expenses of offer.
  • General corporate Purposes.

SBI IPO Details

Issue Dates Mar 2 – Mar 5 ‘ 2020
Issue Size 10,341 Cr. (Approx.)
Face Value Rs. 10 Per Share
Price Band Rs. 750 – 755 Per Share
Min Market Lot 19 Shares
Employee Discount Rs. 75 Per Share
Listing at BSE, NSE
Min Investment Amt (Retail) Rs. 14345
Max Investment Amt (Retail)
 Rs. 186,485 (13 Lots)

SBI Card IPO Schedule

Offer Start Date Mar 2′ 2020
Offer End Date Mar 5′ 2020
Issue TypeBook Built Issue
Finalisation of Basis of Allotment Mar 11′ 2020
Initiation of Refunds Mar 12′ 2020
Credit of Shares to Demat Accounts Mar 13′ 2020
Listing Date of SBI Card IPO Mar 16′ 2020
SBI Cards IPO RegistrarSBI Cards IPO Lead Managers

Link Intime India Private Ltd

C 101, 247 Park, L.B.S.Marg, Mumbai -400083

Email: sbicard.ipo@linkintime.co.in

Websitehttp://www.linkintime.co.in

1. Axis Capital Limited

2. BOA Merrill Lynch

3. HSBC Securities & Capital Markets Pvt Ltd

4. Kotak Mahindra Capital Company Limited

SBI Card GMP (Grey  Market Premium)

Present Grey Market Premium of SBI Card IPO is Rs. 330 Per share as on 25th Feb’2020.

Frequently Asked Questions (FAQs)

SBI Card IPO is an initial public offering of equity shares of value Rs. 10 per share.

SBI Card is India’s second largest Credit Card issuer after HDFC Bank.

SBI Card is s subsidiary of State Bank of India, India’s largest Bank.

SBI Card IPOs Issue Dates are Mar 2 – Mar 5’2020 with Price Band of Rs. 750 – 755 Per share.

SBI Card IPOs allotment date is March 11′ 2020.

Present Grey market Premium (GMP) of SBI Card IPO is Rs. 330 Per share as on 25 Feb’ 2020.

The listing Date of SBI Card IPO is Mar 16’2020.

No there is no Discount for shareholders of SBI, however there is a discount of Rs. 75 Per share for SBI Card Employees.

A person even holding a single share of State Bank of India (SBI) on the cut off date i.e. 18th Feb 2020 is eligible for application under shareholder category for SBI Card IPO

There is a separate reservation for Full and Part time employees of SBI as on date of RHP who can apply under employee category subject to maximum limit not exceeding Rs. 5 Lakh.

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naveen
naveen
December 6, 2019 2:15 pm

Thanks to the Author for such a wonderful analysis…keep it rocking

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