Muthoot Microfin has set the stage for its IPO, revealing a price band of ₹277 to ₹291 per equity share, with subscriptions opening on December 18 and concluding on December 20. The IPO's allocation to anchor investors is slated for December 15, enhancing anticipation within the market.
The price band, spanning between 27.70 to 29.10 times the face value of equity shares, highlights the company's strong financial standing. At the upper end, the price-to-earnings ratio stands at 24.96 times, showcasing robust market potential. The IPO lot size is set at 51 equity shares, enabling easy accessibility for investors.
Muthoot Microfin's IPO reserves 50% of shares for qualified institutional buyers (QIBs), 15% for non-institutional investors (NIIs), and 35% for retail investors, with an additional ₹14 per share discount offered to eligible employees participating in the offering.
The IPO's allotment basis is expected to be finalized by December 21, with refunds initiated on December 22 and shares credited to allottees' demat accounts on the same day. The stock is anticipated to be listed on both BSE and NSE by December 26, in compliance with the mandatory T+3 listing regulation effective from December 1, 2023.
This IPO comprises a fresh issue of shares amounting to ₹760 crore and an offer for sale (OFS) of equity shares valued at ₹200 crore by promoters and others. The net proceeds from the issue will be utilized to bolster the company's capital base, meeting future capital requirements as outlined in the red herring prospectus (RHP).
Muthoot Microfin's RHP underscores the company's objectives, highlighting its intention to sustain existing business activities and fund proposed ventures with the IPO's net proceeds. The company anticipates numerous benefits from listing its equity shares, including enhancing its brand image and establishing a public market for equity shares in India.
Drawing comparisons with listed peers such as Equitas Small Finance Bank, Ujjivan Small Finance Bank, CreditAccess Grameen, and others, Muthoot Microfin stands poised within a competitive landscape.
The IPO is managed by ICICI Securities Limited, Axis Capital Limited, JM Financial Limited, and SBI Capital Markets Limited, with Kfin Technologies Limited serving as the registrar.
In the grey market, the IPO's premium stands at +130, indicating strong investor interest. This premium suggests an estimated listing price of ₹421 apiece, approximately 44.67% higher than the IPO price, showcasing substantial demand beyond the issue price. The 'grey market premium' signifies investor willingness to pay over the issue price, reflecting robust market sentiment towards the IPO.
