Asirvad Microfinance gets SEBI approval; Manappuram Finance shares jump 6%

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shares of Manappuram Finance Ltd. recovered from the day’s low to surge as much as 5% on Tuesday after market regulator Securities & Exchange Board of India (SEBI) approved the IPO of its subsidiary Asirvad Microfinance.

Earlier this year, SEBI had put the Asirvad Microfinance’s IPO in abeyance.

Sources had told CNBC-TV18 that SEBI had highlighted some reasons as to why the IPO was kept in abeyance. Out f the three queries that were raised, two were already resolved, while the third was said to take 15-30 days.

Asirvad Microfinance had filed preliminary IPO papers with SEBI in October last year.

The IPO will have a face value of ₹10 per share and a fresh issue of equity shares of up to ₹1,500 crore, with no Offer for Sale component.

75% of the issue will be available to Qualified Institutional Bidders (QIB), 15% will be reserved for non-institutional bidders, and not more than 10% will be reserved for retail investors.

As per Asirvad’s DRHP, the funds raised through the IPO will be used in augmenting the capital base of the company to meet future business requirements.

JM Financial Ltd., Kotak Mahindra Capital Company Ltd., Nomura Financial Advisory and Securities (India) Pvt. Ltd. and SBI Capital Markets Ltd. are the book-running lead managers, and Link Intime India Pvt. Ltd. is the registrar of the offer.

For the first nine months of financial year 2024, Asirvad Microfinance reported a 67.5% growth in its Net Interest Income, while its profit had tripled year-on-year.

During the December quarter, Asirvad reported a 63.2% growth in its Net Interest Income, while Net profit was up by 80% from last year.

Shares of Manappuram Finance gained as much as 6% on Tuesday to ₹207.30.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow