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Home >> Blog >> Usha Financial Services IPO: Review, Valuation, Date & GMP

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)

Period

Sep 2024

Mar 2024

Mar 2023

Total Assets 

35,133.66

33,585.81

37,222.64

Total Revenue

2,681.26

6,396.05

4,618.73

PAT

504.16

1,344.95

1,016.55

Net Worth

11,106.79

10,602.63

8,207.38

Total Reserves & Surplus

9,519.03

9,014.87

7,265.57

Borrowings

18,861.94

18,128.22

24,751.41

 

Revenue Bifurcation

The revenue bifurcation for various activities is shown below:

(Amount in lac)

Net Cash Flow In Multiple Activities

Sep 2024

FY2024

FY2023

Net Cash Flow Operating Activities

-442.66

7,146.67 

-17,715.95

Net Cash Flow Investing Activities

-94.88

-806.21

178.11

Net Cash Flow Financing Activities

733.71 

-5,572.89

17,451.44

 

Segment-wise Revenue Breakdown

(Amount in lac)

Particulars

Sep 2024

FY2024

FY2023

Loan Financing  

2373.07

5,862.77

4,054.42 

Processing fees and documentation charges 

278.07 

459.43

508.75

Total 

2,651.14

6,322.20

4,563.17

 

Product-wise Revenue Breakdown  

(Amount in lac)

Particulars

Sep 2024

FY2024

FY2023

Loan to NBFCs and corporates 

1,578.09

3,621.24

2,757.11

MSME loan 

727.28

2,166.56

1,293.14

Financing 

67.69 

74.97

4.17

Processing fees 

278.07

459.43

508.75

Total

2,651.13 

6,322.20 

4,563.17

 

Geography-wise Revenue Breakdown (Top 5)

(Amount in lac)

Particulars

Sep 2024

FY2024

FY2023

Delhi       

529.58

1,463.95

1,344.01

West Bengal        

505.96 

1,214.52

600.95

Madhya Pradesh        

202.91 

607.38

201.36

Maharashtra        

228.39

463.53 

255.20

Rajasthan        

207.72 

435.30

246.29

 

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.

Company Name

Face Value (Rs.)

EPS (Rs.)

P/E (x)

IBL Finance Limited

10

1.17

65

 

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.

Particulars

P/E Ratio (x)

Highest 

45.47 

Lowest 

45.47 

Average

45.47 

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).

IPO Opening & Closing date 

October 24, 2024 to October 28, 2024

Face Value 

Rs.10 per Share

Issue Price

Rs.160 to Rs.168 per Share.

Lot Size

800 Shares

Issue Size

5,860,000 Shares (Rs.98.45 Cr)

Offer for Sale 

NA.

Fresh Issue 

5,860,000 Shares (Rs.98.45 Cr)

Listing at

NSE, SME

Issue Type 

Book Built Issue IPO

Registrar 

Skyline Financial Services Private Ltd.

 

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.

Minimum Lot Investment (Retail) 

1 Lot

Maximum Lot Investment (Retail) 

1 Lot

HNI (Min)

2 Lots

 

Usha Financial Services IPO Reservation (% of Net Issue)

Institutional’s Portion

50%

Retail’s Portion

35%

Non-Institutional’s Portion

15%

 

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.

Pre-Issue Promoter Shareholding

98.91%

Post-Issue Promoter Shareholding

72.24%

 

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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Frequently Asked Questions

+

One or two days before the start of the subscription period, you can pre-apply for the IPO through your broker

+

The total issue size is 5,860,000 Shares.

+

October 24, 2024 to October 28, 2024.



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