7 things you must know about the Tamilnad Mercantile Bank Ltd IPO
by 5paisa Research Team
30 Aug 2022
IPO Details
- Open Date 05-Sep-22
- Close Date 07-Sep-22
- Lot Size 28
- IPO Size ₹ 831.60 Cr
- IPO Price Range ₹ 500 to ₹ 525/share
- Min Investment ₹ 14,000
- Listing Exchange BSE, NSE
- Basis of Allotment 12-Sep-22
- Refunds 13-Sep-22
- Credit to Demat Account 14-Sep-22
- Listing Date 15-Sep-22
Tamilnad Mercantile Bank Ltd IPO Subscription Status
| QIB | NII | Retail | TOTAL | |
|---|---|---|---|---|
|
Day 1 Sep 05, 2022 |
0.73x | 0.58x | 1.53x | 0.83x |
|
Day 2 Sep 06, 2022 |
0.98x | 1.27x | 3.61x | 1.53x |
|
Day 3 Sep 07, 2022 |
1.62x | 2.94x | 6.48x | 2.86x |
IPO Synopsis
Tamilnad Mercantile Bank IPO opens to public on opens on Sep 5, 2022, and closes on Sep 7, 2022. The issue comprises of a fresh issue of up to 1,58,27,495 equity shares and an offer for sale of up to 12,505 equity shares. The OFS consists of up to 5,000 shares each being offloaded by D. Prem Palanivel and Priya Rajan, Prabhakar Mahadeo Bobde is offloading 1,000 shares, up to 505 shares are being offloaded by Narsimhan Krishnamurthy and 500 shares each are being offloaded by M. Malliga Rani and Subramanian Venkiteshwaran Iyer. The price band is set at Rs. 500-Rs.525 per share and lot size is fixed at 28 shares per lot. The shares will be allotted on 12th September and the listing date is set for 15th September.
The book running lead managers to this issue are Axis Capital, Motilal Oswal Investment Advisors, SBI Capital Markets.
Objectives of the company
The main objective of the issue is to have funds to augment the bank’s Tier I capital base in case of any future requirements.
About Tamilnad Mercantile Bank Ltd
With an illustrious history of over 100 years, Tamilnad Mercantile Bank is one of the oldest private sector banks in the country. Tamilnad Mercantile Bank was incorporated as “Nadar Bank Ltd” in 1921 and subsequently changed their name to Tamilnad Mercantile Bank in 1962. They are headquartered in Tamil Nadu and have a strong presence in the state, with 396 branches and 941 ATMs all over the state.
They have over 509 branches and out of these 106 branches are in rural areas, 247 are in semi-urban areas, 80 in urban and 76 are in metropolitan areas. As of June 30, 2021, the bank’s entire customer base stood at around 4.93 million, out of which 69.96% comprised customers who had been associated with the bank for over five years. Apart from Tamil Nadu, the bank is present in 15 other states and 4 union territories. They are present in the states of Maharashtra, Gujarat, Karnataka, and Andhra Pradesh and have a presence of 90 branches and 123 ATMs and 15 CRMs as of June 30, 2021.
The bank’s largest branch is in Mumbai and contributes ₹ 16,683.90 million or 2.30% to their total business as of March 31, 2021. One of their oldest branches is in Sivakasi, Tamil Nadu, which was started in 1942 and contributes ₹ 12,806.30 million or 1.77% to our Total Business as of March 31, 2021.
Tamilnad Mercantile Bank Ltd Financial Status
Profit and Loss
Balance Sheet
| Particulars (in Rs. Crores) | FY21 | FY20 | FY19 |
|---|---|---|---|
| Revenue | 4253.4 | 3992.6 | 3638.8 |
| EBITDA | 1251.6 | 1030.1 | 966.8 |
| PAT | 603.3 | 407.7 | 258.6 |
| Particulars (in Rs. Crores) | FY21 | FY20 | FY19 |
|---|---|---|---|
| Total Assets | 47527.17 | 42758.8 | 40532.8 |
| Share Capital | 0 | 324 | 0 |
| Total Borrowings | 142.5 | 142.5 | 142.5 |
| Particulars (in Rs. Crores) | FY21 | FY20 | FY19 |
|---|---|---|---|
| Net cash generated from / (used in) operating activities | -670.36 | 567.35 | 1497.83 |
| Net cash from / (used in) investing activities | -37.11 | -20.18 | -33.61 |
| Net cash flow from / (used in) financing activities | -324.00 | 269.02 | -547.36 |
| Net increase (decrease) in cash and cash equivalents | -1031.47 | 816.19 | 916.85 |
Peer Comparison
There are no listed peer companies in India.
IPO Key Points
-
Strengths
1. They have strong history of around 100 years and are spread across 16 states and union territories and have a strong customer base of 4.91 million customers
2. They started their operations in Tamil Nadu and now 76.33% of their total business is from the state
3. Tamilnad Mercantile Bank has always focused on small ticket size loan products which are provided to MSME customers, agricultural and retail customers
-
Risks
1. The bank cannot open further branches until they are listed on the stock exchanges and have permission from RBI
2. The bank is currently significantly dependent on Retail, MSME and Agri-financing, customers and any adverse developments in these segments could adversely affect the bank’s business
3. An increase in NPAs will adversely affect the portfolio of the bank
How to apply for IPO?
-
Login to your 5paisa account and select the issue in the
current IPO section -
Enter the number of lots and price at which you wish to
apply for -
Enter your UPI ID and click on submit. With this, your
bid will be placed with the exchange -
You will receive a mandate notification to block funds in
your UPI app -
Approve the mandate request on your UPI and funds
will be blocked
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IPO FAQs
What is the lot size and investment required for the Tamilnad Mercantile Bank IPO?
The lot size of Tamilnad Mercantile Bank IPO is 28 shares per lot and a retail-individual investor can apply for up to 13 lots (364 shares or ₹191,100).
What is the price band of the IPO?
The price band of Tamilnad Mercantile Bank IPO is Rs. 500-Rs.525 per share.
When does the Tamilnad Mercantile Bank issue open and close?
Tamilnad Mercantile Bank Ltd IPO will opens on Sep 5, 2022, and closes on Sep 7, 2022.
What is the size of Tamilnad Mercantile Bank IPO issue?
The IPO comprises a fresh issue of up to 1,58,27,495 equity shares and an offer for sale of up to 12,505 equity shares.
Who are the promoters/key personnels of Tamilnad Mercantile Bank?
TMB is a professionally managed bank and does not have an identifiable promoter.
What is the allotment date of Tamilnad Mercantile Bank?
The allotment date of the Tamilnad Mercantile Bank IPO is 12th September, 2022 (tentative)
What is the Tamilnad Mercantile Bank listing date?
The listing date of the Tamilnad Mercantile Bank IPO is 15th September, 2022 (tentative)
Who are the book runners for Tamilnad Mercantile Bank IPO?
Axis Capital, Motilal Oswal Investment Advisors, SBI Capital Markets are the lead managers to the issue.
What is the objective of the issue?
The main objective of the issue is to have funds to augment the bank’s Tier I capital base in case of any future requirements.
How to apply for the Tamilnad Mercantile Bank IPO?
To apply for the IPO, follow the steps given below
• Login to your 5paisa account and select the issue in the current IPO section
• Enter the number of lots and price at which you wish to apply for
• Enter your UPI ID and click on submit. With this, your bid will be placed with the exchange
• You will receive a mandate notification to block funds in your UPI app
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