Muthoot Microfin Ltd. IPO
Muthoot Microfin Ltd.
IPO Listing Details
Listed On
BSE & NSE
Listed On
Issue Price
₹291
Issue Price
Listing Price
₹278
Listing Price
Listing Gains
-₹13.00 (-4.47%)
Listing Gains
IPO Details
Bidding Dates
18 Dec - 20 Dec '23
Bidding Dates
Min. Investment
₹14,127
Min. Investment
Lot Size
51.00
Lot Size
Price Range
₹277 - ₹291
Price Range
Issue Size
676 Cr
Issue Size
Subscription Rate
- Retail Individual Investor7.61x
- Non-Institutional Investor13.20x
- Qualified Institutional Buyers17.47x
- Employees4.95x
About Company
Muthoot Microfin Limited, a subsidiary of Muthoot Pappachan Group, was founded in April 1992 to provide micro-loans to female consumers in rural India. The company offers income-generating loans, Pragathi loans (bridging loans to existing customers for working capital and income-generating activities), secured loans in the form of gold loans, and Muthoot Small & Growing Business ("MSGB") loans for livelihood solutions. They also provide life-improvement opportunities such as loans for cell phones, solar lighting, and household goods. Greater Pacific Capital, an investor shareholder in Muthoot Microfin Ltd, will offer shares worth 50 crore out of the total shares worth 200 crore offered in the OFS. The promoter owners will offer the remaining shares for ₹150 crore. Muthoot Microfin Ltd's whole IPO will thus consist of the issuing and sale of 3,29,89,690 shares (329.90 lakh shares approximately), resulting in a total IPO size of 960.00 crore at the maximum price range of ₹291 per share. Muthoot Microfin is looking to raise ₹960 crore, which includes a fresh issue of ₹760 crore and an offer-for-sale of up to 6,872,852 equity shares, amounting to ₹200 crore. The anchor book for the issue will open on Friday, December 15. f application
Why should you invest in Muthoot Microfin Ltd. IPO?
The company specialises in microfinance, with a focus on rural areas and Joint Liability Group funding. Its performance has been steadily improving, and it has kept NPAs under control. The business has also recorded a significant increase in profit in the last few years.
Muthoot Microfin IPO Grey Market Premium
| Date | GMP |
|---|---|
| 15th December | Rs.88 |
| 14th December | Rs.105 |
Muthoot Microfin IPO Noteworthy Highlights
- The fresh issuance part will primarily be used to supplement its capital base in order to expand its asset book in the future; this is a basic need for most financial asset-based organisations.
- To improve its underwriting capabilities through technology, the company has created a unique credit score card in collaboration with Equifax to evaluate consumer creditworthiness by awarding specific credit scores to customers.
- Currently, the promoters hold a 69.08% stake in the company, which will get diluted post the IPO to 55.47%.
- As per the terms of the offer, 50% of the net offer is reserved for Qualified Institutional Buyers (QIBs), while 35% of the total issue size is reserved for retail investors. The residual 15% is kept aside for the HNI/NII investors.
Muthoot Microfin Ltd. IPO - SWOT Analysis
Strengths
The business approach of the company encourages financial inclusion by catering to low-income groups in 321 districts across 18 states and union territories. Muthoot Microfinance has expanded its activities throughout North, East, and West India during the last five years, expanding its customer base and gross loan portfolio while recording a collection efficiency of 95.84% for 2023.
Weaknesses
The company had debt securities of ₹1370.2 crore and borrowings (excluding debt securities) at ₹5123.0 crore as of March 31, 2023. The business also has had negative cash flows and may continue to do so as a result of its operating, investing, and financing operations.
Opportunities
As of March 31, 2023, the corporation had 1,172 branches, 10,227 employees, and 2.77 million active clients. The company benefits from organic development and the transition away from the unorganised segment as a proxy for the organisation of the financial lending market. Its net margins and ROE have been remarkable in the last year, and its ROA of 1.92% is higher than the industry average.
Threats
MFL, the Corporate Promoter, is heavily regulated in the financial services industry. Any perceived non-compliance by Promoters or Directors could harm the company's reputation, business, operational performance, and prospects.
Financial Snapshot - Muthoot Microfin
Check out the financial performance of Muthoot Microfin for recent years:
| Financial Year | Total Assets | Total Revenues | Net Profit |
|---|---|---|---|
| March 2021 | Rs 4,184 crore | Rs 684 crore | Rs 7.05 crore |
| March 2022 | Rs 5,592 crore | Rs 833 crore | Rs 47.40 crore |
| March 2023 | Rs 8,529 crore | Rs 1,429 crore | Rs 164 crore |
A competitive analysis
Muthoot Microfin has Spandana Spoorthy Financial Limited, Ujjivan Small Finance Bank Limited, Credit Access Grameen Limited and Bandhan Bank Limited as its peers. Take a look at their performances:
Competitive Analysis - Muthoot Microfin Ltd. IPO
| Company Name | Market Capitalisation(Rs.Cr) | 1-Year Return |
|---|---|---|
| Spandana Spoorthy Financial Limited | 7,534 | 68.66% |
| Ujjivan Small Finance Bank Limited | 11,640 | 84.61% |
| Credit Access Grameen Limited | 26,963 | 86.61%td> |
How to apply for Muthoot Microfin Ltd. IPO?
You can apply for the Muthoot Microfin Ltd. IPO in these ways:
UPI
Link your personal bank A/C to a trusted UPI ID and map it with your TradeSmart account. Now, proceed further to book your IPO. On acceptance of the mandate, the bid amount will get blocked in your bank account Learn more.
Demat Account
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