NEW DELHI: The initial public offering (IPO) of Suryoday Small Finance Bank opened for bidding on Wednesday alongside the issue of Nazara Technologies. Analysts seem to have mixed views on the issue, with some pointing to the significant risks that it carries.
The company seeks to raise Rs 581 crore. The primary purpose of the IPO is to meet RBI’s listing requirement within three years of starting banking operations. Unfortunately, it’s being forced to launch its issue amid a pandemic that has left it with more than a few chinks in the armour.
Rajiv Mehta, Lead Analyst for Institutional Equities at Yes Securities, said he does not have a positive view on this IPO for various reasons. He said the company’s asset quality has been impacted severely by Covid-19 and the overall stress remains inadequately addressed. At the same time, its loan-assets diversification is not credible enough, he said.