Aadhar Housing Finance Limited IPO: Review, Valuation, Date & GMP

Aadhar Housing Finance Limited IPO  - Complete Overview

Established in 2010, Aadhar Housing Finance Limited specializes in catering to the low-income housing segment. 

With a focus on retail, the company serves economically weaker and low-to-middle income customers across 20 states and union territories in India. 

Aadhar Housing Finance Limited caters to various housing needs. It offers a diverse range of mortgage-related loan products, including residential property purchase and construction loans, home improvement and extension loans, as well as loans for commercial property construction and acquisition, 

The company boasts an extensive network comprising 487 branches, including 109 sales offices, as of December 31, 2023. These branches and sales offices are strategically spread across 20 states and union territories, operating in approximately 10,926 pin codes across India, ensuring widespread accessibility to its services.

As of December 31, 2023, Aadhar Housing Finance Limited employs a total of 3,885 individuals. Additionally, its wholly-owned subsidiary, Aadhar Sales and Services Private Limited (“ASSPL”), employs a total of 1,875 individuals, further contributing to the company's operational capabilities and outreach.

Aadhar Housing Finance Limited IPO Overview

Aadhar Housing Finance Limited IPO date is slated to be open for subscription from May 8, 2024, to May 10, 2024. This BSE, NSE IPO follows a Book Built Issue IPO.

Aadhar Housing Finance Limited IPO price is fixed in the range of Rs.300 to Rs.315 per share. 

The total issue size of this IPO amounts to Rs.3,000.00 Cr. The company has allocated shares 35% to retail investors, 50% to institutional and 15% to non -institutional investors.

 

 

Company Financial

Compared to the financial year ending March 31, 2023, and March 31, 2022, Aadhar Housing Finance Limited has seen growth in total assets, net worth, and total revenue. The profit after tax has also increased.

(Amount in Crore)

Period	31 Dec 2023	31 Mar 2023	31 Mar 2022
Total Assets	18,035.57	16,617.87	14,375.81
Total Revenue	1,895.17	2,043.52	1,728.56
PAT	547.88	545.34	446.20
Net worth	4,249.10	3,697.60	3,146.63
Reserve & Surplus	13,127.59	12,153.45	10,674.59

Gross AUM by occupation 

(Amount in million)

Occupations	31 Dec 2023	31 Mar 2023	31 Mar 2022
Salaried	113,686.1	100,933.2	90,891.1
Self-Employed	84,965.5	71,295.1	56,886.8
Total	198,651.6	172,228.3	147,777.9

 

The Objective of the Issue

The Company proposes to utilize the Net Proceeds towards the following:

(i) To meet future capital requirements towards onward lending

(ii) General corporate purposes

Peers of Aadhar Housing Finance Limited IPO

Name of the Company	Face Value (Rs)	EPS (Rs)	P/E Ratio
Aadhar Housing Finance Limited	10	13.4	-
Aptus Value Housing Finance India Limited	2	10.1	31.3
Aavas     Financiers Limited	10	54.3	28.1
Home First Finance Company India Limited	2	25.2	34.9
India Shelter Finance Corporation Limited	5	17.5	33.1

 

 

 

Evaluation

The IPO is priced within the range of Rs.300 to Rs.315 per share.

Evaluation of P/E Ratio

• Considering the FY23 EPS of Rs 13.4 from the last year, the resulting P/E ratio is 23.50x.

• Taking into account the weighted EPS of Rs 11.7 for the last three years, the P/E ratio amounts to 26.92x.

Comparative Analysis with Listed Peers

• The industry's average P/E is 31.09x.

As a result, the IPO price range, with a P/E ratio ranging from 23.50x to 26.92x, seems reasonably priced to the industry average of 31.09x.

IPO's Strengths 

• Leading HFC in India specializing in the low-income housing segment (ticket size less than ₹1.5 million), boasting the highest AUM and net worth among peer companies in Fiscal Years 2021, 2022, and 2023, as well as the nine months ending December 31, 2022, and December 31, 2023.

• Demonstrated resilience across business cycles, reflecting a seasoned business model.

• Extensive network of branches and sales offices, facilitating broad geographical coverage and diverse sales channels crucial for loan origination and servicing.

• Strong and comprehensive systems and processes for underwriting, collections, and asset quality monitoring.

• Access to diverse and cost-effective long-term financing managed with discipline in asset liability and liquidity.

• Commitment to social objectives is a fundamental aspect of our business model.

• Experienced and cycle-tested management team, renowned for professional expertise and strong corporate governance.
  
  

IPO weaknesses 

• The previous owners of the company are currently under investigation by regulatory bodies such as the Enforcement Directorate, and the outcome of these investigations could negatively impact the company.

• The company has experienced negative net cash flows in past.

• The company's indebtedness and the conditions and restrictions imposed by its financing agreements could adversely affect its ability to conduct business.

• Compliance with regulations and guidelines issued by regulatory authorities in India, including the National Housing Bank (NHB) and Reserve Bank of India (RBI), is mandatory for the company.

• The company is subject to periodic inspections by the NHB, and any non-compliance with the observations made during these inspections could result in penalties and restrictions.

• Additionally, the company's non-convertible debentures are listed on the Bombay Stock Exchange, subjecting it to rules and regulations governing listed non-convertible debentures.
  
  

IPO GMP Today 

The Latest GMP of Aadhar Housing Finance Limited is Rs.54.

Aadhar Housing Finance Limited IPO timetable (Tentative)

Aadhar Housing Finance Limited IPO is scheduled from May 8 to May 10, 2024, with allotment on May 13, refund initiation on May 14, and listing on May 15, 2024.

Events	Date
IPO Opening Date	May 8, 2024
IPO Closing Date	May 10, 2024
IPO Allotment Date	May 13, 2024
Refund initiation	May 14, 2024
IPO Listing Date	May 15, 2024

 

 

Aadhar Housing Finance Limited IPO Details 

Aadhar Housing Finance Limited IPO, with a face value of Rs.10 per share, opens on May 8 and closes on May 10, 2024, offering 95,238,095 shares at Rs.300 to Rs. 315 per share, with a lot size of 47 shares, aiming to raise Rs.3,000.00 Cr, and will be listed on BSE, NSE.

IPO opening & closing date	May 8, 2024 to May 10, 2024
Face value	Rs. 10 per share
Issue Price	Rs. 300 to Rs. 315 per share
Lot Size	47 Shares
Price of 1 lot	Rs. 14,805
Issue Size	95,238,095 shares (aggregating up to ₹3,000.00 Cr)
Offer for sale	63,492,063 shares of ₹10 (aggregating up to ₹2,000.00 Cr)
Fresh issue	31,746,032 shares (aggregating up to ₹1,000.00 Cr)
Employee Discount	Rs 23 per share
Listing at	BSE, NSE
Issue Type	Book Built Issue IPO
Registrar	Kfin Technologies Limited

Aadhar Housing Finance Limited IPO Lot Details 

For Aadhar Housing Finance Limited IPO, the retail investor can invest in a minimum of 1 lot (47 shares) at Rs.14,805 and a maximum of 13 lots (611 shares) at Rs.192,465 while for HNI investors, the minimum investment is 14 lots (658 shares) at Rs.207,270.

Minimum Lot Investment (Retail)	1 lot
Maximum Lot Investment (Retail)	13 lot
Minimum Lot Investment (HNI)	14 lot
Maximum Lot Investment (HNI)	67 lot

Aadhar Housing Finance Limited IPO Reservation

Institutional share Portion	50%
Non-institutional share Portion	15%
Retail share Portion	35%

 

Promoters and Management of Aadhar Housing Finance Limited

BCP Topco VII Pte. Ltd.

Pre-issue Promoter shareholding	98.72
Post-issue Promoter shareholding

 

Aadhar Housing Finance Limited IPO Lead Managers

• ICICI Securities Limited

• Citigroup Global Markets India Private Limited

• Kotak Mahindra Capital Company Limited

• Nomura Financial Advisory And Securities (India) Pvt Ltd

• SBI Capital Markets Limited
  
  

Dividend Policy

No dividend on Equity Shares has been declared or paid by our Company during the last three Financial Years.

 

 

Conclusion

The upcoming IPO offers a promising investment opportunity for investors. The company specializes in affordable housing and has maintained a solid revenue stream. With a nationwide footprint and a loyal customer base, this IPO presents an offer to investors to potentially maximize their profits following a thorough evaluation.

 

Finowings IPO Analysis

Hope you enjoyed the Finowings IPO Analysis. We tried our best to give every required detail about the company that you should know before applying to the IPO. 

You must consult your financial advisor before making any financial decisions. 

To Apply for the IPO, Click Here.

 

To Read the Prospectus of the Company Click Here to Download the DRHP.

 

 

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