Equitas SFB IPO: Diversified loan book helps firm overcome poor Day-1

At Rs 61.95 a share, the stock has more than doubled from listing day as the Street is acknowledging its diversified book

Against an issue price of Rs 32-33 a share, the Equitas Small Finance Bank (Equitas SFB) stock listed at Rs 31. Hitting the bourses at the peak of the pandemic, just a month after the moratorium was lifted, sentiments were not in favour of Equitas and the banking sector. What was also a dampener was the comparison with Ujjivan SFB, which hit the Street in December 2019.
 

When compared to Ujjivan, Equitas’ asset quality didn’t appear very convincing at the time of listing as its gross non-performing assets (NPA) ratio was over 100 basis points (bps) higher than Ujjivan’s. Therefore,