Usha Financial Services IPO: Review, Valuation, Date & GMP

Usha Financial Services IPO-Complete Overview

Usha Financial Services Pvt Ltd is the book-builder of the Rs. 98.45 crore Usha Financial Services IPO, which falls under the SME IPO category. The business was founded as a non-banking financing organization in May 1995. It provides lending options to MSMEs, corporates, individuals, and other NBFCs. It also focuses on lending money to female business owners.

The business also offers finance services for electric vehicles (EVs). It offers MSMEs, NBFCs, body corporates, and private people a broad range of financial solutions.

With an AUM of Rs. 30,695.76 lac, the company has a net worth of Rs. 10,602.63 lac. To make money, the corporation uses two different business models: retail lending (A) and wholesale lending (B).

The company's range of products is:

• Loans to Corporates and other NBFCs.

• Green financing and electric vehicle financing.

• MSMEs with a focus on small business owners.

The "initial public offering" (IPO) for Usha Financial is scheduled to begin on October 24, 2024, and run through October 28, 2024.

 

Usha Financial Services IPO Overview

58.6 lac Shares are being issued entirely fresh in the Rs. 98.45 crore new SME IPO. 

This upcoming IPO date is between 24 October and October 28, 2024. The Usha Financial Services IPO price is set between Rs.160 & Rs.168 for each Share. 

The expected IPO listing date is, October 31, 2024, and listing at NSE and SME.

If You want to apply for the IPO, Click Here to Open a Demat Account.

Company Financial

During the fiscal years ending March 31, 2024, and 2023, the company's revenue increased by 38% and PAT increased by 32%.

(Amount in Lac)

 

Revenue Bifurcation

The revenue bifurcation for various activities is shown below:

(Amount in lac)

Segment-wise Revenue Breakdown

(Amount in lac)

 

Product-wise Revenue Breakdown  

(Amount in lac)

(Amount in lac)

 

The Objective of the Issue

The company desires to use the Net Proceeds from the Issue to fulfill its following goals:

• Increase the company's capital base.

• General corporate purposes.

 

Peers of Usha Financial Services Ltd.

 

Note:-

The basic EPS of the peers is for the financial year ended on 31 March 2024.

Evaluation

For each share, the IPO price ranges from Rs.160 to Rs.168.

Evaluation of P/E Ratio

Considering the FY ended 31 Mar 2024 with an EPS of Rs.8.64 from the last year, the resulting P/E ratio is 19.45x.

Considering the weighted EPS of Rs.7.38 for the last three years, the P/E ratio is 22.76x.

Comparative Analysis With Listed Peers

The average P/E Ratio of the industry is 45.47x.

In simple words, the P/E ratio of this IPO (19.45x), compared with the industry’s average P/E of 45.47x, has an undervaluation (on a P/E ratio basis only). Hence the price of the Share seems fully priced for the investors when considered based on the average P/E ratio of the industry.

 

IPO's Strengths

• Excellent record.

• Making use of our Promoters' experience.

• A skilled and driven workforce and an accomplished management team.

 

IPO’s Weaknesses

• Requires a substantial quantity of capital to run, and any change in the price and accessibility of capital, as well as its sources of funding, could have a detrimental effect on the business's cash flows, operations, and financial status.

• Any reduction in the loans' credit quality could harm the business's operations and financial stability.

A large portion of its costs are made up of portfolio management charges that are included in other expenses. If the company is unable to successfully reduce and control these costs, future profitability may suffer.

 

 

Usha Financial Services IPO GMP

The IPO GMP today is Rs.40 as of 21 October 2024. With a price of Rs.168 per Share, the estimated IPO listing price is Rs.208 when writing this information.

IPO Timetable (Tentative)

October 24, 2024, is the date of Usha Financial Services' IPO. On October 29, allotment will take place, followed by a refund beginning on October 30, and listing on October 31, 2024.

Events	Date
IPO Opening Date	October 24, 2024
IPO Closing Date	October 28, 2024
IPO Allotment Date	October 29, 2024
Refund Initiation	October 30, 2024
IPO Listing Date	October 31, 2024

 

Usha Financial Services IPO Details 

The IPO with a Face Value of Rs.10 per share offers a total issue size of 5,860,000 Shares (Rs.98.45 Cr).

Usha Financial Services IPO Lot Details 

Retail investors have to participate in multiples of 1 Lot (800 Shares) at a minimum and maximum of Rs.1,34,400, while HNI investors can engage in a minimum of 2 Lots (1600 Shares) at a minimum of Rs.2,68,800.

 

Usha Financial Services IPO Reservation (% of Net Issue)

Promoters And Management of Usha Financial Services Ltd.

• Mr. Rajesh Gupta

• Mr. Anoop Garg

• Ms. Geeta Goswami

• Ms. Nupur Gupta

• M/s BR Hands Investments Private Limited.

 

IPO Lead Managers

• Narnolia Financial Services Ltd.

• Unistone Capital Pvt Ltd.

Dividend Policy

No dividends paid by the company since its inception.

Conclusion

Usha Financial Services IPO resembles an investment chance in a strong NBFC with an emphasis on women entrepreneurs, MSMEs, and green financing. Undervalued P/E in comparison with the industry average; makes a good candidate for IPO. However, capital dependency and the quality of loans may pose challenges to the investor's pocket.  

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.

Disclaimer: 

DISCLAIMER: This blog is NOT any buy or sell recommendation. The content is purely for educational and information purposes only. We do NOT encourage/advise/suggest our active readers to be involved in any kind of buying or selling securities activities. Always consult your eligible financial advisor for investment-related decisions. The author does NOT through this blog intend to involve readers in trading.

  

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