Muthoot Microfin Ltd. IPO - Review, Valuation, Date & GMP

Muthoot Microfin Limited IPO - Complete Overview

Muthoot Microfin Limited (MML) is a non-banking financial company (NBFC-MFI) that provides micro-loans to women entrepreneurs with a focus on rural regions of India. It was originally established as a division of Muthoot Fincorp Limited in 2010. In December 2011 a Mumbai-based Pancharatna Securities Ltd which was a non-banking financial company (NBFC), was purchased by the Muthoot Pappachan Group. Later it was renamed Muthoot Microfin Limited (MML).

In March 2015, MML obtained a microfinance institution (MFI) license as a non-banking financial company (NBFC-MFI) from the Reserve Bank of India. As of March 31, 2023, Muthoot Microfin has a portfolio size of Rs. 9,200 crore with a borrower base of 2.7 million women entrepreneurs. In 2021, Muthoot Microfin Ltd launched the Mahila Mitra app to help rural women beneficiaries with repayment. Muthoot Microfin operates in 18 states with 1,172 branches and over 10,000 employees

 

Muthoot Microfin Limited IPO Overview

Muthoot Microfin Limited IPO date is slated to be open for subscription from December 18, 2023, to December 20, 2023. This BSE, NSE IPO follows a Book Built Issue IPO.

Muthoot Microfin Limited IPO  price is fixed at Rs.277 to Rs.291. The upcoming BSE, NSE IPO will be listed on December 26, 2023.

The total issue size of this IPO amounts to Rs. 960.00 CR. Within this total issue, 35% is issued to retail investors, and 15% is issued to other investors.

 

Detailed Video

 

 

Muthoot Microfin Limited IPO timetable (Tentative)

Events	Date
IPO Opening Date	18 December 2023
IPO Closing Date	20 December 2023
IPO Allotment Date	21 December 2023
Refund initiation	22 December 2023
IPO Listing Date	26 December 2023

 

Muthoot Microfin Limited IPO Details

IPO opening & closing date	18 December to 20 December 2023
Face value	Rs.10 per share
Issue Price	Rs. 277 to Rs. 291 per Share
Lot Size	51 Shares
Price of 1 lot	Rs. 14,841
Total Issue Size	32,989,690 Shares (aggregating up to Rs. 960.00 Cr)
Offer for sale	6,872,852 shares of Rs.10 (aggregating up to Rs. 200.00 Cr)
Fresh issue	26,116,838 Shares (aggregating up to Rs. 760.00 Cr)
Listing at	BSE, NSE
Issue Type	Book Built Issue IPO
Registrar	Kfin Technologies Limited

 

 

Muthoot Microfin Limited IPO Lot Details

Application	Lots	Shares
Minimum Lot Investment (Retail)	1	51
Maximum Lot Investment (Retail)	13	663
Minimum Lot Investment (HNI)	14	714

 

Muthoot Microfin Limited IPO Reservation

QIB Shares Offered	Not more than 50%
Retail Shares Offered	Not less than 35%
Other Shares Offered	Not less than 15%

 

Company Financial

In FY23, the company's total assets surged to Rs. 8,529.20 crore, with total revenue reaching Rs. 1,446.34 crore, and PAT at Rs. 163.89 crore. The net worth, reserves & surplus, and total borrowings also showed significant increases, reflecting strong financial growth compared to FY22 and FY21.

(Amount in Crore)

Period	FY 23	FY 22	FY 21
Total Assets	8,529.20	5,591.46	4,183.85
Total Revenue	1,446.34	842.94	696.28
PAT	163.89	47.40	7.05
Net worth	1,625.85	1,336.58	889.89
Reserve & Surplus	1,282.15	1,040.10	642.84
Total Borrowings	6,493.18	3,996.61	3,015.66

 

Gross Loan Revenue Distribution State Wise

In 2023, the gross loan revenue distribution by region indicates a shift with the South contributing 55.96%, down from 64.81% in FY22. The North and East regions have seen an increase, accounting for 20.83% and 13.33%, respectively.

( % age) 

Zones	F.Y. 23	F.Y 22	F.Y 21
South	55.96	64.81	66.72
North	20.83	15.43	15.02
East	13.33	11.06	9.20
West	9.88	8.70	9.06
Total	100.00	100.00	100.00

 

Revenue By Operations

In FY23, the company reported a significant increase in revenue from operations, reaching Rs. 14,287.64 million compared to Rs. 8,325.06 million and Rs. 6,841.67 million in FY22 and FY21, respectively. Additionally, other revenues also rose to Rs. 175.80 million, contributing to a total revenue of Rs. 14,463.44 million for FY23, marking a substantial growth.

(Amount in Millions)

Particulars	FY 23	FY 22	FY 21
Revenue from operations	14,287.64	8,325.06	6,841.67
Other	175.80	104.35	121.14
Total	14,463.44	8,429.41	6,962.81

 

 

The Objective of the Issue

The company intends to use the net proceeds for the following objectives.

• To carry out our ongoing business operations.
• The company aims to carry out funded activities using Net Proceeds and expects benefits from listing Equity Shares on Stock Exchanges, enhancing brand image, and creating a public market in India.

 

Promoters and Management of Muthoot Microfin Limited IPO

1. Thomas John Muthoot
2. Thomas Muthoot
3. Thomas George Muthoot
4. Preethi John Muthoot
5. Remmy Thomas
6. Nina George

Pre-issue Promoter Shareholding	69.08%
Post-issue Promoter Shareholding	55.47%

 

Muthoot Microfin Limited IPO Lead Managers

• ICICI Securities Limited
• Axis Capital Limited
• Jm Financial Limited
• SBI Capital Markets Limited

 

Peers of Muthoot Microfin Limited IPO

Muthoot Microfin Limited has a P/E of 14.19 with no specified EPS. Compared to peers like Equitas and Ujjivan Small Finance Bank, Muthoot's valuation appears reasonable. However, Spandana Sphoorty Financial stands out with a high P/E of 381.72 and a low EPS of Rs. 1.74.

Name of the Company	Face Value (Rs. per Share)	P/ E	EPS (Basic) (Rs.)
Muthoot Microfin Limited	10	20.50	14.19
Equitas Small Finance Bank Limited	10	17.57	4.71
Ujjivan Small Finance Bank Limited	10	6.33	5.88
CreditAccess Grameen Limited	10	26.67	52.04
Spandana Sphoorty Financial Limited	10	381.72	1.74
Bandhan Bank Limited	10	17.32	13.62
Suryoday Small Finance Bank Limited	10	22.31	7.32

 

IPO's Valuations

To evaluate the IPO's valuation, we can utilize the information presented in the company's DRHP. Muthoot Microfin IPO price is fixed at Rs. Rs.277 to Rs.291 per share, with an EPS of Rs. 14.19. The company's P/E ratio is calculated at 20.50 based on the issue price.

 

Dividend Policy

The company hasn't paid dividends in past fiscal years. Whether we can pay them in the future depends on factors like profits, past dividend trends, capital needs, legal restrictions, and other relevant considerations evaluated by our Board.

 

IPO's Strengths

• Muthoot Microfin has demonstrated robust financial growth, as evident from the significant increases in total assets, total revenue, and profit after tax over the years.
• With 1,172 branches operating in 18 states and a borrower base of 2.7 million women entrepreneurs, Muthoot Microfin has established a wide-reaching presence, particularly in rural areas.
• The company's focus on providing micro-loans to women entrepreneurs in rural regions reflects a socially responsible business model, contributing to financial inclusion and empowerment.
• Muthoot Microfin's portfolio size of ₹9,200 crore signifies a diverse range of loans, contributing to a balanced and resilient business.

 

IPO's Weaknesses

• The shift in gross loan revenue distribution, with a decrease in the South region's contribution, may pose a challenge. Investors should monitor how the company adapts to regional variations.
• The absence of dividends in past fiscal years might affect the attractiveness of the IPO for income-focused investors.

 

IPO GMP Today

The Latest GMP of Muthoot Microfin Limited IPO is Rs. 35.

 

Conclusion

In simple terms, the Muthoot Microfin Limited IPO is a chance for people to invest in a company that gives small loans to women entrepreneurs in rural India. The company has been doing well financially, but we don't know the exact details of the IPO yet, like how much it will cost or when it will happen. Investors should be careful and wait for more information before deciding if they want to invest.

 

 

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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