Glenmark Life Sciences, Utkarsh Small Finance Bank get SEBI go ahead to float IPO

The initial public offer (IPO) of Utkarsh Small Finance Bank comprises fresh issue of equity shares worth Rs 750 crore and an offer for sale to the tune of Rs 600 crore by promoter Utkarsh Coreinvest Ltd, according to draft red herring prospectus (DRHP).

Glenmark Life Sciences' IPO comprises fresh issue of up to Rs 1,160 crore and an offer for sale of up to 73,05,245 equity shares by Glenmark Pharmaceuticals Ltd.

The two companies received markets regulator's observation on June 3, an update with the Securities and Exchange Board of India (Sebi) showed on Tuesday.

Sebi's observation is necessary for any company to launch public issues like initial public offer, follow on public offer and rights issue.

Utkarsh Small Finance Bank and Glenmark Life Science had filed preliminary IPO papers with Sebi in March and April respectively.

The Varanasi-headquartered lender would utilise proceeds from the fresh issue to augment tier 1 capital base to meet future capital requirements.

Utkarsh began operations as a small finance bank in 2017, transiting from a microfinance lender since 2009. The small finance bank's bulk of the lending portfolio is towards microfinance.

As on September 30, 2020, the small finance bank across 528 banking outlet served 2.74 million customers majorly located in rural and semi urban areas in the states of Bihar, Uttar Pradesh and Jharkhand that has a significant untapped market.

The lender's deposits and disbursements have grown at a CAGR of 54.48 per cent and 33.66 per cent respectively, during FY18-20.

ICICI Securities, IIFL Securities and Kotak Mahindra Capital Company have been appointed as book running lead managers to the issue.

Glenmark Life Sciences, a subsidiary of Glenmark Pharmaceuticals, is a leading developer and manufacturer of select high value, non-commoditized active pharmaceutical ingredients (APIs) in chronic therapeutic areas, including cardiovascular disease, central nervous system disease, pain management and diabetes.

The company also manufactures and sells APIs for gastro-intestinal disorders, anti-infectives and other therapeutic areas.

Going by the draft papers, proceeds from the fresh issue worth Rs 900 crore will be used towards payment of outstanding purchase consideration to the promoter for the spin-off of the API business and around Rs 153 crore for funding the capital expenditure requirements.

Goldman Sachs (India) Securities Private Limited, SBI Capital Markets, Kotak Mahindra Capital Company, BofA Securities India Ltd, DAM Capital Advisors Ltd and BoB Capital Markets are the lead managers to the issue.