​New kid in town SBI Cards and Payment Services, a subsidiary of the State Bank of India (SBI), will hit the primary market with a Rs 10,350 crore initial public offering on March 2. The IPO will be the fifth biggest in India so far. With investor interest already high in the IPO, we bring you all the details you need to know before hitting 'subscribe' on the issue:



(With inputs from Yes Securities and Axis Capital)



Who is SBI Card anyway? SBI Cards is the second-largest credit card issuer in India, having a market share of 18.1% in terms of the number of credit cards outstanding as of November 30, 2019. The firm was incorporated on May 15, 1998. It is engaged in the business of issuing credit cards to consumers in India. It is incorporated as a joint venture between State Bank of India and GE Capital Mauritius Overseas Investment.



Is it a good profit-making venture? The company has a diversified revenue model whereby it generates both non-interest income as well as interest income on its credit card receivables. The share of revenue from operations that the company derives from non-interest income has steadily increased over the past three fiscal years, from 43.6 per cent in FY17 to 48.9 per cent in FY19, YES Securities said in a report. The company’s total income increased from Rs 34,71 crore in FY17 to Rs 7,286.80 crore in FY19 at a CAGR of 44.9 per cent and its revenues from operations increased from Rs 3,346.20 crore in FY17 to Rs 6,999.10 crore in FY19 at a CAGR of 44.6 per cent. Net profit increased from Rs 372.90 crore in FY17 to Rs 862.7 crore in FY19 at a CAGR of 52.1 per cent. According to a Crisil report, the company is a leading player in open market customer acquisition in India. It had a presence in 3,190 open market points of sale across the country as of 9M FY20.



SWOT Analysis: Key Strengths >> Second largest credit card issuer in India with deep industry expertise and a demonstrated track record of growth and profitability.

>> Diversified customer acquisition capabilities.

>> Support of a strong brand and pre-eminent promoter.

>> Diversified portfolio of credit card offerings.

>> Advanced risk management and data analytics capabilities.

>> Modern and scalable technology infrastructure.

>> Highly experienced and professional management team.

