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    SBI Cards IPO: These key company personnel to turn millionaires on listing

    SBI Cards IPO: These key company personnel to turn millionaires on listing

    SBI Cards IPO: These key company personnel to turn millionaires on listing
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    By Pranati Deva   IST (Published)

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    Sources told CNBC-TV18 that the SBI Cards IPO is expected to be priced in the range of Rs 745-775 per share giving the company a market cap of around Rs 69,500-72,000 crore.

    SBI Cards and Payment Services, the credit card unit of the country’s largest lender State Bank of India, will launch its initial public offering on March 2, aiming to raise about Rs 9,000 crore. Sources told CNBC-TV18 that the SBI Cards IPO is expected to be priced in the range of Rs 745-775 per share giving the company a market cap of around Rs 69,500-72,000 crore.
    The SBI Cards IPO comprises a fresh equity issue worth Rs 500 crore and a total dilution of around 14 percent is expected to be done through SBI Cards IPO via an Offer For Sale (OFS) route. Out of the total of 14 percent, SBI is likely to dilute 4 percent whereas the balance 10 percent will be diluted by private equity firm, Carlyle Group.
    SBI currently owns a 74 percent stake while Carlyle Group owns a 26 percent stake in SBI Cards. The offer is expected to help SBI raise Rs 2,780-2,880 crore alone.
    The offer for sale is of up to 130,526,798 equity shares including up to 37,293,371 share sale by SBI and up to 93,233,427 shares on offer by Carlyle Group.
    The prospectus also stated that the portion of the offer up to 18,64,669 equity shares will be available for allocation to eligible employees, on a proportionate basis.
    "Our Company has formulated an employee stock option scheme, namely SBI Card Employee Stock Option Plan, 2019 (the “SBIC ESOP Scheme”). Under SBIC ESOP Scheme, 13,343,700 options have been granted as on the date of this Draft Red Herring Prospectus, and none of these options have vested," the prospectus stated.
    Under this scheme, a number of employees are slated to become millionaires. Key managerial personnel including Monish Vohra - Executive Vice President & Head Customer Services at SBI Card, Richhpal Singh - company's Chief Operating Officer, Amit Batra - Executive Vice President and Head, Operations, Anu Gupta - Executive Vice President and Head, Collections, Girish Budhiraja - Executive Vice President and Chief Product and Marketing Officer, among others have been granted options under the ESOP scheme.
    Here's how much some of these key personnel will make with respect to Rs 775 as issue price:
    SBI Cards is the second-largest credit card issuer in India, with an 18 percent market share. SBI holds 76 percent in SBI Cards and the rest of the stake is held by Carlyle Group. While Carlyle is looking to sell a 10 percent stake in the company via IPO, SBI would sell 4 percent.
    The share sale is poised to become the fifth-largest IPO in the country after Coal India, Reliance Power, GIC Re and Oil and Natural Gas Corp (ONGC) and will help the parent, SBI, raise funds to boost credit growth. For FY19-20, it is likely to be the largest IPO.
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