Catholic Syrian Bank (CSB) Limited IPO

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(i) They are one of the oldest private sector banks in India with a history of over 98 years and have a strong base in Kerala along with a significant presence in Tamil Nadu, Karnataka, and Maharashtra. It has developed a well recognized and trusted brand in south India, particularly in the states of Kerala and Tamil Nadu.

(ii) It offers a wide range of products and services to our overall customer base of 13 lakh as of March 31, 2019, with a particular focus on SME, Retail, and NRI customers.

(iii) It delivers products and services through multiple channels, including 414 branches (excluding three service branches and two asset recovery branches) and 277 ATMs spread across 16 states and four union territories as on March 31, 2019, and various alternate channels such as micro ATMs, debit cards, internet banking, mobile banking, point of sale services and UPI.

(iv) The Bank has a long operating history as a traditional bank, they are currently focusing on the implementation of strategic changes in the business model to function efficiently as a full-service new age private sector bank backed by new marquee investor-FIHM( Prem Watsa, a Candian Billionaire), the Promoter. To this end, they are re-aligning organizational set-up for efficiently driving our operations and business strategy, wherein branches will be responsible only for deposits, cross-selling and customer servicing and all loan products will be driven by dedicated teams, with each business team operating as a profit center.

(v) The major performance highlights for the last three Fiscals are as follows:

a) On the deposits side, while overall deposits grew at a slower pace from ₹ 14911 cr in Fiscal 2017 to ₹ 15123 cr  in Fiscal 2019 due to conscious strategy adopted by bank of reducing term deposits and focusing more on CASA, the CASA deposits increased from ₹ 3694 cr as on March 31, 2017, to ₹ 4210 cr as on March 31, 2019, and the CASA ratio improved from 24.78% in Fiscal 2017 to 27.84% in Fiscal 2019, leading to a significant reduction in the cost of deposits from 6.89% in Fiscal 2017 to 5.87% in Fiscal 2019.

b) Advances started growing again from Fiscal 2017. The advances increased from ₹ 8,000 cr in Fiscal2017 to ₹ 10,615 cr in Fiscal 2019. The yield on advances decreased from 11.10% as of March 31, 2017, to 9.85% as of March 31, 2019.

c) The credit to deposit ratio increased from 53.65% in Fiscal 2017 to 70.19% in Fiscal 2019.

d) The gross NPAs decreased to 4.87% as of March 31, 2019, from 7.25% as of March 31, 2017. The net NPAs decreased to 2.27% from 4.12% during the same period, while the provisioning coverage ratio was 65.50%,75.83%, and 78.16% in respect of NPAs (including technical write-offs) as of March 31, 2017, March 31, 2018, and March 31, 2019, respectively.

e) The net interest margin increased from 2.11% in Fiscal 2017 to 2.80% in Fiscal 2019 primarily on account of reduction in our cost of funds and an increase in credit to deposit ratio. The net interest income increased from ₹313 cr in Fiscal 2017 to ₹439 cr in Fiscal 2019.

Objects of the Catholic Syrian Bank (CSB) Limited IPO:

(i) Fresh Issue of the 24 cr, to augment  Bank’s Tier-I capital base to meet Bank’s future capital requirements which are expected to arise out of growth in our Bank’s assets, primarily our Bank’s loans/advances and investment portfolio and to ensure compliance with Basel III and other RBI guidelines. (ii) Offer for Sale the Selling Shareholders propose to sell an aggregate of up to 19,778,298 Equity Shares, aggregating up to ₹ 385 cr on the upper band of Rs. 195.  

Catholic Syrian Bank (CSB) Limited IPO Details:

Current GMP: 57-59
Open Date: Nov 22 2019
Close Date: Nov 26 2019
Total Shares: 21009067
Face Value: ₹ 10 Per Equity Share
Issue Type: Book Building
Issue Size: 405-409 Cr.
Lot Size: 75 Shares
Issue Price: ₹ 193-195 Per Equity Share
Listing At: NSE,BSE
Listing Date: Dec 04 2019

Promoters And Management:

(i) Mr. Madhavan Karunakaran Menon is the Part-time Chairman and a non– executive Director of the Bank. He holds a bachelor’s degree and a master’s degree in business administration from George Washington University. He is also qualified for the award of “Indian School Certificate” in division two issued by the University of Cambridge. He has over 30 years of experience in the finance and banking sector. He has previously worked with ANZ Grindlays Bank Limited, Citibank N.A., Emirates Bank International, Birla Capital International AMC 210 Limited in the past. (ii) Mr. Rajendran Chinna Veerappan is the Managing Director and Chief Executive Officer of the Bank. He holds a bachelor’s degree and a master’s degree in commerce from Madurai Kamaraj University and is an associate of the Indian Institute of Bankers. He previously served as the chief executive of the Association of Mutual Funds in India and is currently responsible for overall management and expansion of our Bank. He has over 40 years of experience in the banking and finance sector and was previously associated with Corporation Bank, Andhra Bank and Bank of Maharashtra. He has been on our Board since November 24, 2016. (iii) Mr. Sumit Maheshwari is a non-executive Director of the Bank. He holds a bachelor’s and a master’s degree in commerce from the University of Mumbai. He is a certified associate member of the Institute of Chartered Accountants of India. He has completed the postgraduate program in management from the Indian School of Business. He has over 10 years of experience in the finance sector. Previously, he has worked with KPMG and is currently the managing director and chief executive officer of Fairbridge Capital Private Limited. He has been on our Board since September 3, 2018. (iv) Mr. Thomas Mathew is an Independent Director of the Bank. He holds a bachelor’s in commerce degree from the University of Kerala. He is a fellow member of the Institute of Chartered Accountants of India and has around 34 years of experience in the finance sector. In the past, he has worked with Lovelock & Lewes, Chartered Accountants and has served as a director on the central board of State Bank of India in the past. He has been on our Board since April 24, 2017.

Financials of Catholic Syrian Bank (CSB) Limited IPO:

Particulars  ( in Crs) 6MFY20 FY18-19 FY17-18 FY16-17
Deposits 15509.81 15123.87 14690.65 14911.56
Net Advances 11297.83 10615.23 9337.36 8118.93
Net Interest Income (NII) 278.9 439.95 384.81 313.6
Non-Interest Income 84 135.92 125.42 281.2
Operating Profit/(Loss) 103 13.36 74.33 151.71
Provisions and Contingencies (Other than tax) 59.3 313.69 223.69 160.63
Profit / (Loss) before Tax 43.7 -300.16 -149.36 -8.92
Net Profit /(Loss) 44.27 -197 -97.47 1.55
Key Performance Indicators
Capital Adequacy Ratio (CRAR)% Basel – II 22.77 16.77 9.92 12.18
Earnings per share 7.7 -23.73 -12.04 0.21
Book value per share 114 108.79 109.81 123.44
Net Interest Margin% 3.40% 2.51% 2.32% 1.91%
Cost-Income Ratio% 71.54% 97.68% 85.43% 74.49%
Return On Assets (ROA)% 0.49% -1.13 -0.59 0.01
Financial Highlights of FY18-19 1. Net Interest Income crossed 400 crore mark and stood at 440 crores, growing at 14%. Net Interest Margin continued its upward journey, 2.3% to 2.5%. 2. Credit Deposit Ratio improved from 64% as of 31.03.18 to 70% as on 31.03.19, thanks to credit growing at 14%. 3. Non-Interest Income increased from 125 crore to 136 crore or by 9% due to an increase in commission on bancassurance, processing fees, recovery of bad debts written off, etc. 4. Due to a reduction in retirement age and increased annuity cost for DA of pensioners, staff cost increased from 287 crore to 384 crore – an increase of around 100 crore which has affected the operational profit. 5. Our operating profit reduced from 74 crore to  13 crore due to the above-mentioned surge in staff costs. 6. The bank had conducted a stock audit of all those accounts whose credit limit are 25 lakhs & above 297 such accounts were identified for conducting a special stock audit. Based on the stock audit report, the bank had classified accounts with aggregate exposure of 31 crores as NPA. There were strict instructions to branches to desist from any act of ever-greening. Hit to P&L on account of provision for NPA was 262 crore in FY 19 as against 191 crore in FY 18, due to these prudential measures. 7. On Asset quality front the worst seems to be over for the bank. While gross NPA reduced from 7.9% to 4.9%, Net NPA reduced from 4.5% to 2.3%. Provisioning Coverage Ratio improved from 62% to 78%.

Comparison With Peers:

(All figures are in cr)
Name of the bank Deposits Deposit growth  (3 years) Loan book Loan book growth  (3 years) Interest Income NIM
CSB Bank 15,123 0.71% 10,615 14.71% 439 2.51%
DCB Bank 28,435 8.83% 23,568 22.00% 2447 2.52%
Federal bank 1,34,954 17.55% 1,10,222 22.60% 9089 1.82%
South Indian Bank 80,420 10.29% 62,693 16.25% 5396 0.92%
City Union 38,447 8.18% 32,673 8.46% 3177 3.37%
Karur Vysya Bank 59,867 5.61% 48,580 8.98% 5815 2.44%
Name of the bank GNPA N.NPA ROA Book Value P/B Share Performance in last one year
CSB Bank 4.90% 2.30% -1.13% 108 1.80x 21.87%
DCB Bank 1.84% 0.64% 0.92% 103 1.70x 13.50%
Federal bank 2.96% 1.47% 0.78% 67 1.31x 10%
South Indian Bank 4.99% 3.40% 0.26% 29 0.38x -23%
City Union 2.99% 1.80% 1.51% 65 3.30x 28.91%
Karur Vysya Bank 9.15% 4.98% 0.30% 80 0.70x -28%
Note: 1. Financials of FY18-19 is taken for calculating Deposit, Loan, Interest, G.NPA, Net NPA, ROA, Book Value. 2. Price to calculate P/B multiple is taken as closing price of 20.11.2019. 3. Last one year performance is taken to judge how the banks have performed. Karur Vysya being the worst performer and same can be easily judge by very high NPA numbers. High NPA numbers means street will punish you. 4. City bank has fairly performed in the last one year and same can be judged by high premium of P/B multiple. So high P/B means there is a demand for stock. 5. For calculating CSB bank last one year return, the unlisted market price is taken as a base. 6-8 months back the share was available at Rs. 160 in the unlisted market. The IPO price is Rs. 195, so return of 21%.

Recommendation on Catholic Syrian Bank (CSB) Limited IPO:

Review and Recommendation of InvestorZone is: 5/10 Pros: 1. It is a turnaround bank. The Bank has shown a profit of 44 cr in the first 6MFY20 financials. Gross NPA has come down to 2.9%. The NIM has gone up to 3.4% from 2.51% in FY18-19. 2.  With Fairfax Holding ~Rs.1200 cr infusion in the bank, the bank has ample capital to work with. The bank now has CRAR of 22.77% which is well above the regulatory requirement. IPO is just the regulatory requirement as per RBI norms. Cons: 1. The concentration of the bulk of business in one state. The 68% business is coming from Kerala only. Any problem in the state may generate fresh NPAs. 2. The mainstay of the business is SME and Gold loan. The gold loan segment is highly competitive. The SME loan growth depends upon the economic development of the country. With GDP slowing down, it may affect the SME segment. Valuation The bank is valued at P/B multiple of 1.56x post issue.

Lead Manager of Catholic Syrian Bank (CSB) Limited IPO:

  1. Axis Capital Limited

Registrar of Catholic Syrian Bank (CSB) Limited IPO:

  1. Link Intime India Private Limited

Bid Details of Catholic Syrian Bank (CSB) Limited IPO as on
26-Nov-2019 22:45:01 IST

No.of shares offered No. of shares bid No. of total times
6,302,721 391,921,425 62.18
3,151,360 518,972,475 164.68
2,100,906 93,551,025 44.53
- - -
- - -
11,554,987 1,004,444,925 86.93
No.of shares offered No. of shares bid No. of total times
6,302,721 147,042,450 23.33
3,151,360 375,610,050 119.19
2,100,906 74,500,050 35.46
- - -
- - -
11,554,987 597,152,550 51.68
No.of shares offered No. of shares bid No. of total times
6,302,721 244,878,975 38.85
3,151,360 143,362,425 45.49
2,100,906 19,050,975 9.07
- - -
- - -
11,554,987 407,292,375 35.25

Total Number of Applications in Retail Category: 9,99,929

Application-wise Subscription in Retail Category: 35.70X

Discussion on Catholic Syrian Bank (CSB) Limited IPO:


    muje allotment nahi mila, lekin abhi tak lien account me Rs. 14625
    dikha rahe hai to sir ye amount kab tak release hogi.maine upi se request accept kiya tha… please answer me.

    Very good listing gain. Congrats to all. Book profit now.

    Issue Price= 195
    Listing Price = 275
    At 10:00 am = 295

    more than 50% gain on listing.

    LISTING ON:-04-12-2019
    SCRIP CODE-542867
    ISSUE PRICE-195/-

    Best of luck for tomorrow listing.

    When will the amount be unblocked from account? Unfortunately I was not allotted any shares against my application? Will it be today or tomorrow?

    csb bank retail portion over subcribe 36 time when allotment in retail category1 out of 35

    If you can hold the shares for 1 year then you should buy unlisted shares of CSB from
    Please note that Lock-in period for unlisted shares is 1 year hence you won’t be able to sell unlisted shares of CSB before 1 year. Seeing the IPO demand, it looks like a wise decision to buy unlisted shares in just Rs.210-220 range and hold it for 1 year!

      Why the lock in period of 1 year? And elaborate how much minimum shares one has to buy at that price?

        This is the rule my friend. For every unlisted share, when it lists, the non-ipo shares get locked for 1 year from listing date. You can buy unlisted shares in lot of 100.. so you can buy 100, 200, 500, 1000 shares as per your financial capacity.

        Thanks for the info friend, i would like to know whether one can buy 10 shares?

    As CSB bank money will be Released on 3rd Dec. Fund Houses are Hesitating to Fund for CSB.
    All the Fund Houses Have urged Ujjivan BRLM to delay IPO by a day. Therefter BRLM have delayed IPO to 2nd Dec. Just to make sure Proper Funding for CSB.
    Now all the Fund Houses are ready to Fund Money for CSB bank, as now CSB Money will be Released on 3rd and the same will be used for Ujjivan.
    Huge Demand for Ujjivan is seen. In a Scene of Liquidity Crunch Fund Houses have asked for more Money. 
    I am Noticing 20000 CR demand seeing the Premium. 
    Let PB official announcement and See that Premium is Stable Post Announcement.

    On seeing Liquidity Crunch in market. 
    But My retail friends have Garnered 800 CR till now for this IPO.

    It’s coming on 2nd Dec to 4th Dec
    Cut of Date: 25th Nov 

    ROC will give Approval Tomorrow. 

    Incase the HNI and QI are not subscribed fully or undersubscried can the company allot those shares to reatil investors?????

      There is no such case where QIBs and HNIs won’t apply , there is no chance to happen so don’t worry,

      QIB apply on last day because of 2 reasons

      1) QIBs and HNIs wait for statistics to look at Retail demand
      2) QIBs and HNIs mostly borrow heavy sum from others (so by applying on last day of “3 day IPO”, they save interest rate for 2 days for the money borrowed)

      If QIBs and HNIs didn’t applied means there is only one case, which is very very very poor retail category demand

    I have applied today for 2 lots thee any chance that people applying on 2 nd day will also get shares as already it is 100 % subscribed ..

    Is applying for more shares improves the chance of allotment? Eg: If over subscription is 2.5 times and I apply for 4 lots, can I get confirm allotment of I (one) lot?

    CSB Bank
    63-65 @Rajkot Low Volume

    USFB 11-11.5 Low Trade

    RHP is filed today Will be Uploaded Tommorow, ROC and RBI Approval Granted.

    Cut of Date: 22nd Nov 2019 For Ujjivan Shareholder Quota.

    Those Holding Ujjivan Shares as Per Registrar on 22nd Nov are Beneficiaries of Applying Under USFB Category.

    Retail Discount Upto 5%.
    PB 35~37

      No only one method or else it will be rejected since the system compares only PAN, meaning there should be only one application per single PAN

    *CSB Bank Limited – IPO*

    Issue Size: *₹410 cr*

    Price Band: *₹193 – ₹195*

    _*Apply for 75 equity shares @ ₹195/- per share*_

    _*IPO closes on Tuesday, November 26, 2019*_

    *Anchor Book (₹184 cr)* had participation from marquee long-only Foreign and Domestic Institutional Investors.

    *Anchors for the deal include*
    – OMERS
    – ICICI Prudential MF
    – SBI MF
    – Birla MF
    – Axis MF
    – Sundaram MF
    – HSBC Global
    – White Oak
    – Jupiter
    – IIFL AIF
    – Birla Life
    – Aurigin
    – Edelweiss

    *Good investment opportunity!*

    *Lead Manager: Axis Capital*

    The major performance highlights for the 6 month period ended September 30, 2019:

    • The Total Assets (gross) were ₹ 17,755.5 crore.

    • The overall deposits were ₹ 15,509.8 crore. The CASA deposits was ₹ 4,371.9 crore

    • The advances were ₹ 11,297.8 and the yield on advances was 10.22%

    • The credit to deposit ratio was 72.84%. The effective risk weight of standard advances was 39.97%.

    • The gross NPAs was 2.86% and the net NPAs was 1.96

    . The bank has made a profit of 44 cr in the first 6MFY20.

    The bank is listing it’s share only due regulatory requirement of RBI.

    The bank don’t required funds.

    Lol it’s you the spammer spamming everywhere in the internet with your referral Code,

    Misusing Code to get your personal income from others opening account using your reference, damn you fraud

    Dear all
    Don’t get trapped by this fraudster

    Lol it’s you the spammer spamming everywhere in the internet with your referral Code,

    Misusing Code to get your personal income from others opening account using your reference, damn you fraud

    Dear all
    Don’t get trapped by this fraudster

    Key takeaways from CSB Bank catholic ipo meet


    Honestly the sort of turnaround that the bank has achieved in past 18 months is nothing short of phenomenal. Profitability of the bank should see massive improvement in next 2 years driven by higher loan growth, better book mix, high margins and low cost income ratio. Bank can deliver mid teens ROE from FY22, and hence can command a premium to peers. Also CEO seems very confident on its ability to deliver better return ratios, management team quality is also very decent.

    Capital adequacy at 22% has improved substantially post fair fax infusion.

    Loan book has started to grow at 17-18%, this is helping in an increase in credit deposit ratio, which in turn is helping in better margins. Credit deposit ratio should continue to improve.

    Current book mix – 33% is gold loan, 32% SME, 8% retail and 28% corporate.

    Going forward growth will be driven by gold, msme and retail.

    A new msme team from a private bank is joining this month to drive msme growth. 2 wheeler and gold loans there is already a very competitive team in place.

    NIM has improved to 3.4% from 2.1% in FY16, margins should continue to improve via a better credit deposit ratio, a better loan book mix (gold loan yields are 12.5% and have an upward bias, MSME yields also upwards of 12%, – both the business should be growth drivers for them with their mix improving sharply)

    Deposits- Bank has cut rates this year and despite the cut seen a 98% renewal rate in retail term deposits, this should help contain cost of funds at low levels. CASA ratio stands at 28%, management intends to take this to over 40% in next few years.

    Operating costs- In last 2 years, employee base has reduced from 3000 to 1900, additionally now the bank is out of the IBA wage agreements, almost all its employees are on CTC basis. Management has reduced employee cost significantly, and they target further reduction. Current average salary per employee is 11.5 lac, where as new employees are being appointed at 3.5-4 lac, it expects a material reduction in costs of wages in next few years.

    Also currently bank has 260 branches which won’t be expanded in a big way, they will shut some branches and open new branches.

    Cost Income ratio- FY19 cost income ratio was 102%, it included one time provisioning of 100 crore on account of VRS given to employees. Currently cost income ratio has improved to 66%, this should further see sharp improvement driven by higher income growth led by better margins and expansion in loan book, at the same time operating cost should be contained in account of continuous reduction in employee cost.

    Asset Quality- currently GNPA is 2% with almost 80% Provision cover. All of the legacy problems have been more than addressed and no shocks is expected going ahead. In the new disbursement taken place in last 3 years, they have seen only one major NPA of 25 crore, and as such management is confident of asset quality of the new book. Credit costs are expected to be pretty controlled.

    Promoter holding – Fairfax will own 49.7% stake post listing, it has to get this down to 40% in next 5 years, 30% in 10 years and 15% in next 15 years progressively.

    Post heavy losses in FY18/19, CSB declares operating profit of 90 crore in H1FY20 and 44 crore of PAT. This implies 4.5% ROE.

    Bank post issue Mcap is expected to be 3400 crore, it’s net worth is about 2000 crore currently.
    implying a P/BV of 1.7x TTM.
    CSB Bank

    Many People are spreading negative news as many counters are short.

    I repeat Bank has no such news.
    Bank is transforming Hence Prem Wasta has boarded train to turn Around.

    Those who are short must cover.
    Mostly listing at 230-260 depending on Other situations.

    Retail is 10% so Allotment is Hard
    Its a small IPO anyone can Operate it easily.

    No Retail Pressure will b there.

    Hence Apply.

    Premium may come down, due to less Funding Availability with HBFC. Even Ujjivan will Eat Money.

    GMP Rock Solid at 68/-

    💡 *USFB IPO – Issue Information *(Tentative)*

    Issue Opens on: *29 November 2019*

    Issue Closes on: *03 December2019*

    Issue Type: Book Built Issue IPO

    Issue Size: 34,28,57,142 Shares

    Face Value: Rs.10/- per Share

    Issue Price: *Rs.34 – Rs.35 per Share (Tentative)*

    Market Lot: *425 Shares*

    Listing At: NSE, BSE

    (i) Strong channel network and trusted brand in South India; strong capital base;
    (ii) well established SME business;
    (iii) a retail offering is driven by strong gold loan portfolio;
    (iv) stable and granular deposit base;
    (v) professional and experienced management with strong and independent Board; and
    (vi) streamlined risk management controls, policies, and procedures.

    (i) Canadian Billionaire Prem Watsa owned Fairfax India Holdings has a 51% stake in Thrissur based lender Catholic Syrian Bank which he bought last year for a total consideration of around Rs 1,200 crore. The deal happened at a mutually agreed price of Rs 140 per share.

    (ii) Prem Watsa CM (born 1950) is an Indo – Canadian billionaire businessman who is the founder, chairman, and chief executive of Fairfax Financial Holdings, based in Toronto. He has been called the “Canadian Warren Buffett.”

    (iii) After acquiring 51% stakes in CSB bank, it has become India’s first foreign bank.

    💡 *CSB IPO -* Market’s Current Estimates of oversubscription:

    RII = 4.50L Forms = *16.09X Applic.* wise (Avg allotment of ~4.66 shares per lot)👈🏻

    NII = 18.5K Crs. = ~293.95X

    Interest cost @7.50%p.a. for 7days = 28.77paise for 1X

    Thus, for NII the costing = 293.95 X 28.77paise = Rs.84.56 per share (= GMP)

    And, for RII the costing = 4.66 X 84.56 = Rs. ~394/- (= Kostak)


    *CSB IPO – *GMP Estimated*

    *GMP 85 +/- 1*

    20/11/19 – Wednesday
    22/11/19 – Friday

    *Price Band* :- ₹ 190 to ₹ 200[ not confirmed]

    *Discount (Retail & Employees) :-* ₹ 10 on offer price

    *Bid Lot* :- Adding Soon

    *Shares offered :-* 19,778,298

    *Employee Reservation* :- Adding Soon

    *Issue Size * :- Approx ₹ 400Crores

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