Hello, guys this is my new blog on IPO of SBI CARD. So let’s see…
SBI card IPO has a lot of discussion at this time in the market. SBI is a good brand in India and it is big also. Moreover, Credit cards are good opportunities for business in India. The SBI card is being listed on the Stock Exchange and through the IPO the company is planning to raise about Rs.9600 Cr. 74% stake in SBI CARD is of SBI and 26% stake is CA Rover Company which is US-based company.
SBI CARDS is a subsidiary company of SBI And it is a credit card based company. As I know, SBI has a total of 24,000 branches in India. SBI CARDS can get good benefit to reach their product to more consumers due to having more branches.
SBI CARDS IPO DATE
IPO open:12-Feb-2020/ Close:14-Feb-2020
PRICE BAND: ₹660-₹680
How Credit Card Company Earns:
The revenue to the credit card company comes from two ways. One is credit interest as credit given to their customers and second is Late fees and Annual fees etc.
Credit cards have annually 20% of CAGR(Compound annual growth rate) in India. So that we understand that the demand for credit cards is increasing.
Facts Behind Growing Credit Cards Sales:
If seen, e-commerce is becoming popular in India, and products are being sold here at cheap prices. Therefore more people have preferred to buy online. The e-commerce websites offer a lot of offers on credit cards, such as no-cost EMI’s, 5-15% of discounts and many cashback. Because of that, people preferring to buy with a credit card and people are also applying for credit cards.
Most people spend more money than their salary on valuables with credit cards. And there is a huge number of younger generations that they use it to purchase iPhones, branded clothes and shopping, etc. And if see, there is a high ratio of youth in India. So maybe high chances of the demand zone for credit cards.
Credit Card Market In India:
According to other developed countries, the number of credit cards in India is very less. If seen, there are only 3 credit cards behind 100 people in India, 300 credit cards behind 100 people in the US, 210 credit cards behind 100 people in Japan. And if we see other developed countries India has a very low volume of credit cards.
While the number of credit card users in India is increasing, and other companies also selling their credit cards and contributing. So that competition will continue in the credit card business. In India, huge consumers are of HDFC bank credit card on first number and SBI credit cards on the second number.
The total revenue of SBI in FY17-18=5370cr And it increases in FY 18-19=7286cr. And if we see total profit of SBI CARDS in FY 17-18 is 601cr and it increases in FY18-19 to 862cr.
So that is an overview of SBI CARDS and IPO. If you like it so please share it with your friends and family.
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