SBI MF, Morgan Stanley pick up shares in SBFC Finance

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Domestic fund house SBI Mutual Fund, along with Morgan Stanley Asia and Custody Bank of Japan, bought 3.8 crore shares of SBFC Finance for ₹330 crore. The deal was executed at an average price of ₹88 per share through bulk deals on the NSE.

While SBI MF bought 1.93 crore shares for ₹170 crore, Custody Bank Of Japan bought shares worth ₹100 crore, and Morgan Stanley Asia purchased 69 lakh shares for ₹60.5 crore.

Promoter group entities Arpwood Partners Investment Advisors and Arpwood Capital were the sellers. They together sold 5.6 crore shares for ₹494 crore.

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As of the end of March, the total promoter group held a 60.7% stake in the company, of which only a 5.5% stake is held by Indian promoters — Eight45 Services, Arpwood Capital, and Arpwood Partners Investment, according to data from exchanges.

SBFC Holdings PTE, classified under foreign promoters, currently held a 55.2% stake in the company.

In an interaction with CNBC-TV18, Aseem Dhru, MD & CEO of the company, said there will be pressure on net interest margins (NIMs) and non-performing assets in the financial sector. During the March quarter, SBFC’s cost of funds increased by 8 basis points (bps).

However, he sounded more optimistic about bringing the cost down by 50 bps in FY25. “The cost of funding through banks may continue to get expensive,” said Dhru.

Earlier in the day, CNBC -TV18 had reported the development by quoting sources. Even though the management confirmed the newsbreak, it didn’t divulge the list of buyers. Indian promoters offloaded their entire stake for ₹536.5 crore. The offer price for the deal was set at ₹87.50 to ₹91.65 per share.

Shares of SBFC Finance ended Tuesday’s session at ₹87.35, down 4.7% from the previous close. The company, which debuted on August 16, 2023, had a bumper listing on the bourses with a listing day gain of 62%.

Incorporated in 2008, SBFC Finance offers loans against property, personal, secured, and gold loans. SBFC Finance serves entrepreneurs and the owners of micro, small, and medium-sized enterprises in the country.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow