AU Small Finance Bank is a prominent, retail focused non-banking finance company (“NBFC”) primarily serving low and middle income individuals and businesses that have limited or no access to formal banking and finance channels.Company operates in three business lines: vehicle finance; micro, small and medium enterprises (“MSMEs”) loans; and small and medium enterprises (“SMEs”) loans.Company is categorized as a “Systemically Important, Non-Deposit Accepting Asset Finance Company” (NBFC-ND-AFC) by the Reserve Bank of India.
Company received a license from the RBI to set up a ‘small finance bank’ (“SFB”) on December 20, 2016 and they are the only NBFC categorized as an asset finance company to obtain such license.Going forward, they intend to expand and strengthen the business model to offer a diverse suite of banking products and services by leveraging our asset based lending strengths, existing customer base and cost efficient, technology driven hub-and-spoke branch operating model to create a successful new SFB.
Company had commenced its operations in 1996 in Jaipur, Rajasthan and was registered as an NBFC with the RBI in 2000 and in 2005, Company became a commercial associate of HDFC Bank for originating and servicing vehicle loans
Company has adopted a strategy of contiguous expansion across regions and as of December 31, 2016, they conduct their operations through 300 branches spread across 10 states and one union territory in India, with significant presence in the states of Rajasthan, Gujarat, Maharashtra and Madhya Pradesh and employed 6,092 personnel serving 270,692 active loan accounts. The credit penetration of Gujarat, Madhya Pradesh and Rajasthan is below average, while the credit penetration of Maharashtra is above average thus offering a very significant growth potential for the company.
Competitive Strengths of the Company:
- Experienced Management Team and Qualified Operational Personnel.
- Diversified Product Portfolio and Revenue Streams.
- Customer Centric Organizational Commitment.
- Significant Presence in Rural and Semi-Urban Markets with Focus on Low and Middle Income Customers.
- Robust and Comprehensive Credit Assessment and Risk Management Framework.
- Access to Diversified Sources of Funding.
Future Growth Strategies for the Company:
- Leveraging the Existing Capabilities and Customer Base as a Transition into a Retail Focused Small Finance Bank.
- Grow the Branch Network in the Existing Markets.
- Provide a Comprehensive Suite of Banking Services.
- Will Enhance Our Brand Presence.
Company’s management Team:
- Mr.Mannil Venugopalan (Designation: Chairman and Independent Director)
- Mr.Sanjay Agarwal (Designation: Managing Director)
- Mr.Uttam Tibrewal (Designation: Whole-time Director)
Branches of the Company:
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Services Provided by the Company:
Following Services under Personal Banking:
- Savings Account
- Current Account
- Term Deposit
- Debit Card
Following Services under Retail Loans:
- Secured Business Loan
- Gold Loan
- Kisan Loan
Following Services under Wholesale Banking:
- Business Banking
- NBFC/HFC/MFI Lending
- Real Estate Group
Objectives of the Issue:
Company expects that listing of the Equity Shares will enhance the visibility and brand and provide liquidity to
its existing shareholders.
Positives for the Company:
- Diversified Product portfolio and revenue streams.
- Customer centric organisational commitment.
- Significant presence in rural and semi-urban markets with focus on low and middle income customers.
- Robust and comprehensive credit assessment and risk management framework.
- Access to diversified sources of funding over the years.
- Experienced management team and qualified operational personnel