Fusion Micro Finance IPO ends with good subscription

Published on Nov 05, 2022 11:48

The initial public offer (IPO) of Fusion Micro Finance received bids for 6,30,36,040 shares as against 2,13,75,525 shares on offer. The issue was subscribed 2.95 times.

The Qualified Institutional Buyers (QIBs) category was subscribed 8.59 times and the Non Institutional Investors (NIIs) category was subscribed 1.38 times.

However, the Retail Individual Investors (RIIs) category was subscribed just 51%.

The issue opened for bidding on Wednesday (2 November 2022), and it closed on Friday (4 November 2022). The price band of the IPO was fixed at Rs 350-368 per share.

The offer comprised a fresh issue of up to Rs 600 crore and offer for sale of up to 1,36,95,466 equity shares.

The company proposes to utilize the net proceeds towards augmenting its capital base. In addition, it expects to receive the benefits of listing of the equity shares on the stock exchanges and enhancement of company`s brand name amongst existing and potential customers and creation of a public market for equity shares in India.

Ahead of the IPO, Fusion Micro Finance on 28 October 2022, raised Rs 331.2 crore from anchor investors. The board has finalized the allocation of 89,99,943 shares at Rs 368 per share to 17 anchor investors.

Fusion Micro Finance is a second largest microfinance non-banking finance company (NBFC) in terms of gross loan portfolio (GLP) providing financial services to unserved and underserved women in rural and peri-rural areas across India. It is one of the youngest companies in terms of getting an NBFC- micro finance institution (MFI) licence among the top NBFC-MFIs in India in terms of AUM. As of June 2022, total AUM of the company was Rs 7389.02 crore.

The company has prioritized organic geographic diversification since inception in 2010, with a focus on strategic management of state concentration risk by expanding into underpenetrated rural areas that offer significant growth opportunities. The company has built a significant footprint across India with network of 966 branches and 9,262 permanent employees spread across 377 districts in 19 states and union territories in India serving 2.90 million active borrowers end June 2022.

The company reported a total income of Rs 360.45 crore and a net profit of Rs 75.10 crore in the three months ended on 30 June 2022.