RBL Bank lists at 22% premium over issue price of Rs 225

Shares of private sector lender RBL Bank listed at a 22% premium on Wednesday, making a strong debut on the stock exchanges.

On the Bombay Stock Exchange, the issue opened at Rs 273.70, versus it’s issue price of Rs 225 a share. It hit a high of Rs 284.60 in early trade.

RBL Bank, which hit markets with its Rs 1,213 crore public issue earlier this month, saw its IPO subscribed near 70 times. The Kolhapur-headquartered bank is the first private sector lender to tap capital markets in a decade. The last IPO of a private bank was that of Yes Bank in 2005.

The issue was priced in the Rs 224-225 band.

The IPO of RBL Bank, among the fastest growing private banks, was priced competitively compared with other listed peers with valuations at 2.1 times of its post IPO book value, analysts had said.

“The bank has grown its loan book at a CAGR of over 60% in the last five years with diversification. The bank has stayed away from stressed sector lending like steel, power, infra, which has helped it to maintain its asset quality at better levels compared to peers despite 60% loans in corporate and medium and small enterprise sector,” said Pritesh Bumb, analyst at Prabhudas Lilladher.