ABHI Microfinance Bank Plans Rs3 Billion IPO on Pakistan Stock Exchange

The proposed offering comprises 132 million shares, with book-building scheduled for November 5 and 6 and public subscription on November 12 and 13.

ABHI Microfinance Bank plans to raise between Rs2 billion and Rs3 billion through an initial public offering (IPO) of 132 million ordinary shares on the Pakistan Stock Exchange (PSX).

According to disclosures submitted to the PSX, the bank has set a floor price of Rs15 per share. The book-building process will take place on November 5 and 6, followed by the retail subscription period on November 12 and 13.

The institutional book-building portion comprises 99 million shares, representing 75% of the total offering. The remaining 33 million shares will be offered to the general public.

The IPO price may increase by up to 50% from the floor price, setting the maximum price at Rs22.50 per share. The floor price includes a premium of Rs5 per share.

At the minimum price, the offering is expected to generate gross proceeds of approximately Rs1.98 billion. The bank plans to use the funds primarily to expand its loan portfolio and strengthen its capital base.

The proposed capital injection is also expected to improve the bank’s capital adequacy ratio (CAR), support balance-sheet growth and help it meet the regulatory capital requirements set by the State Bank of Pakistan (SBP).

IPO to Support Capital Position

According to the bank’s projections, the IPO proceeds will help address its existing capital shortfall and improve its CAR. Expected earnings over the next two years are also projected to strengthen its capital position.

ABHI Microfinance Bank forecasts a profit of Rs2.927 billion for calendar year 2026. Its management expects earnings of approximately Rs1.5 billion in the second half of the year.

The bank projects that its CAR will turn positive and reach around 4.3% by the end of 2026 after including the IPO proceeds and projected earnings, before other capital adjustments.

The capital position is expected to improve further in 2027 as the bank retains profits. Along with routine regulatory capital adjustments, the CAR is projected to reach 17.8% by the end of that year, exceeding the SBP-prescribed minimum of 15% for microfinance banks.

Underwriters and Business Operations

The general public portion of the IPO will be fully underwritten by Arif Habib Limited, Topline Securities Limited, Growth Securities (Private) Limited and Dawood Equities Limited.

ABHI Microfinance Bank operates through branch-based and branchless banking channels. It has a technology-enabled digital platform and more than 114 branches across over 108 cities in Pakistan.

Its services include gold-backed loans, earned wage access, salary-backed lending, advance salary financing, merchant financing and microenterprise lending. The bank also provides financing to businesses operating in the agriculture and livestock sectors.

According to the PSX disclosures, ABHI (Private) Limited holds a 73.73% stake in the bank, while TPL Corp Limited owns the remaining 26.27%.

The proposed IPO will provide the bank with additional equity to support lending expansion and improve its regulatory capital position. The final amount raised will depend on the price determined through the book-building process.