About the Company:
SBI Cards and Payment Services Ltd is the second-largest credit card issuer in India, with 18.1% market share of the Indian credit card market in terms of the number of credit cards outstanding as of November 30, 2019.
SBI cards is a subsidiary of SBI, India’s largest commercial bank in terms of deposits, advances and number of branches.
Company has 17.9% market share of the Indian credit card market in terms of total credit card spends in the six months ended November 30, 2019.
Company offers an extensive credit card portfolio to individual cardholders and corporate clients which includes lifestyle, rewards, travel and fuel, shopping, banking partnership cards and corporate cards covering all major cardholder segments.
Company’s Credit Card Portfolio:
SBI Cards has a broad credit card portfolio that includes SBI Card-branded credit cards as well as co-branded credit cards that bear both the SBI Card brand and co-brand partners’ brands.
Company offers four primary SBI Card branded credit cards: SimplySave, SimplyClick, Prime and Elite, each catering to a varying set of cardholder needs.
SBI Cards is also the largest co-brand credit card issuer in India and have partnerships with several major players in the travel, fuel, fashion, healthcare and mobility industries, including Air India, Apollo Hospitals, BPCL, Etihad Guest, Fbb, IRCTC, OLA Money and Yatra, among others.
Company’s Major Shareholders:
- State Bank of India owns 74%
- CA Rover Holdings, an affiliate of the Carlyle Group, owns 26%.
How does the Company make Money?
Company typically charge the cardholders an annual credit card fee for credit cards.
In addition to periodic interest charges, company also charges cardholders other fees as specified in the cardholder agreements. These fees may include fees for late payments where a cardholder has not paid at least the minimum payment due by the required due date, returned checks and balance transfer transactions.
Apart from interest and fees from cardholders, company also receive interchange fees from the merchant acquirer that settles the cardholders’ transactions with merchants and as business development incentives from the payment networks.
Who are the TOP Players in this Business?
HDFC Bank is the market leader and has maintained its market share in the number of outstanding credit cards at approximately 27.0% over the years, followed by SBI Card at 18.0%, ICICI Bank at 14.0% and Axis Bank at 13.0%.
No. of Credit Cards/ Market Share/ CAGR Growth of key players in the Credit card Industry:
Positives for the Company:
Parent Company (SBI) has Extensive Reach:
SBI Cards had a presence in 3,009 open market points of sale across India as of September 30, 2019. In addition to this the partnership with SBI provides company with access to SBI’s extensive network of 22,007 branches across India, which enables the company to market the credit cards to SBI’s vast customer base of 436.4 million customers as of March 31, 2019.
Leading Credit Card issuers in India.
SBI Cards is one of the leading credit card issuers in India, which is one of the fastest growing economies in the world with an expanding and under-penetrated credit card market. The competitive strengths should help company to capitalize on the future growth in India’s credit card market.
Company is also the largest pure-play credit card issuer in India and have deep expertise in India’s credit card market as a result of more than 20 years’ operating history.
Second Largest Credit Card issuer in India.
Company is the second-largest credit card issuer in India both in terms of numbers of credit cards outstanding and amounts of credit card spends, with 9.46 million credit cards outstanding as of September 30, 2019 and Rs.103200 cr ($14.5 billion) in total of credit card spends in fiscal 2019.
Management Team:
- Mr. Rajnish Kumar (Designation: Non-executive Chairman)
- Mr. Hardayal Prasad (Designation: Managing Director and Chief Executive Officer (Nominee of SBI)
Objectives of the Issue:
- There are no listed companies in India that engage in a business similar to that of SBI Cards and Payment Services Ltd. Accordingly, it is not possible to provide an industry comparison.
Financials of the Company:
| (in Crores) | FY 17 | FY 18 | FY 19 | 31st Dec 19 |
|---|---|---|---|---|
| Revenue | 3471.0 | 5370.1 | 7286.8 | 7240.1 |
| Net Profit | 372.8 | 601.1 | 862.7 | 1161.2 |
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IPO Details:
| Details | Info |
|---|---|
| Issue Opens on | 2nd March 2020 |
| Issue Closes on:. | 5th March 2020 |
| Issue Price | Rs.750 -755 |
| Employee Discount | Rs.75 per share |
| Face Value | Rs.10 |
| Minimum Lot | 19 Shares |
| Minimum Investment | Rs.14,345 |
| Issue Constitutes | 14.60% |
| Issue Size | Rs. 10,354 ($1.44 billion) |
| Market Cap | Rs. 70,891 ($9.86 billion) |
| Listing at | NSE & BSE |
| Equity Shares Offered (Fresh) | 66,22,516 |
| Equity Shares Offered (OFS) | 13,05,26,798 |
| Total Equity Shares Offered (Fresh +OFS) | 13,71,49,314 |
| Equity Shares Prior to the Issue | 93,23,34,278 |
| Equity Shares after the Issue | 93,89,56,794 |
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Important Dates:
| Finalization of Basis of Allotment | On or before 11th March 2020 |
| Initiation of Refunds | On or before 12th March 2020 |
| Credit of Equity Shares: | On or before 13th March 2020 |
| Listing Date: | On or before 16th March 2020 |
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Subscription Details: (Will be Updated)
| (Subscription-Category-Wise (no. of times) Till time : 06:00 PM) | Shares Offered | 2nd March | 3rd March | 4th March | 5th March |
|---|---|---|---|---|---|
| QIB | 2,42,24,003 | 0.00 | 0.13 | 57.19 | 57.19 |
| NII | 1,83,41,418 | 0.12 | 0.47 | 2.19 | 45.23 |
| Retail | 4,27,96,641 | 0.63 | 1.22 | 1.77 | 2.51 |
| Employee | 18,64,669 | 0.80 | 1.84 | 3.29 | 4.74 |
| Reservation Portion Shareholder | 18,64,669 | 0.69 | 1.40 | 3.54 | 25.35 |
| TOTAL | 10,02,79,411 | 0.39 | 0.85 | 15.49 | 26.54 |
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IPO Valuation Parameters:
| Earnings Per Share (EPS) | Price To Earnings ratio (PE) | Return on Net Worth (RoNW) | Net Asset Value (NAV) |
|---|---|---|---|
| 7.79 | 96.91 | 17% | 46.99 |
| Check IPO Allotment Status: |
|---|
Link InTime Website (Click on the below Link)https://linkintime.co.in/PublicIssue/ |
Also Read: Important Tips for Investing in IPO.
| Company Contact Info: |
|---|
| SBI Cards and Payment Services Ltd Unit 401 & 402, 4th Floor Aggarwal Millennium Tower E-1,2,3 Netaji Subhash Place, Wazirpur New Delhi 110 034, India Telephone: +91 (11) 6126 8100 E-mail: investor.relations@sbicard.com; Website: www.sbicard.com |
| IPO Registrar Info: |
|---|
| Link Intime India Private Limited C-101, 1st Floor, 247 Park Lal Bahadur Shastri Marg, Vikhroli (West) Mumbai – 400 083 Maharashtra, India Telephone: +91 22 4918 6200 Email: sbicard.ipo@linkintime.co.in Website: www.linkintime.co.in |
