Muthoot Microfin resubmits draft papers to SEBI for Rs 1,350 Cr IPO
Muthoot Microfin Ltd, the microfinance subsidiary of the Muthoot Pappachan Group, has resubmitted its draft papers to the Securities and Exchange Board of India (SEBI) with the aim of raising Rs 1,350 crore through an initial public offering (IPO). The company had previously filed its draft papers in 2018.
The IPO comprises a fresh issue of up to Rs 950 crore and an offer for sale (OFS) of up to Rs 400 crore by its promoters and shareholders.
The OFS includes share sales of up to Rs 70 crores each by Thomas John Muthoot, Thomas Muthoot, and Thomas George Muthoot, up to Rs 30 crores each by Preethi John Muthoot, Remmy Thomas, and Nina George, and up to Rs 100 crores by Greater Pacific Capital WIV Ltd.
As of March, Muthoot Fincorp holds a 72.36 percent stake in Muthoot Microfin. Creation Investments India has an 11.13 percent stake, while Greater Pacific Capital WIV Ltd holds a 25.15 percent stake in the company.
The funds raised from the fresh issue will be utilized to strengthen the capital base. As of March 2023, the lender’s Capital to Risk-Weighted Assets Ratio (CRAR) stood at 21.87 percent, with the Tier I Capital constituting the same percentage. In line with RBI guidelines, the company is required to maintain a CRAR of 15 percent, consisting of both Tier I and Tier II capital.
ICICI Securities, Axis Capital, JM Financial, and SBI Capital Markets have been appointed as the Book Running Lead Managers for the IPO.
Muthoot Microfin is backed by Muthoot Fincorp, which holds the position of the fourth-largest Non-Banking Financial Company-Microfinance Institution (NBFC-MFI) in India, based on its gross loan portfolio as of December 2022. The company also holds the third-largest position among NBFC-MFIs in South India and proudly claims the largest market share among MFIs in Kerala. Additionally, Muthoot Microfin plays a significant role in Tamil Nadu, boasting an impressive market share of nearly 16 percent as of December 2022.
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As of March 2023, the company’s gross loan portfolio amounted to Rs 9,208.30 crore. It serves 2.77 million active customers through a workforce of 10,227 employees across 1,172 branches in 321 districts spread across 18 states and union territories in India. The company has established 358 e-clinics, which represent 30.55 percent of its total branches. As of March 2023, 41.60 percent of its customers have enrolled in e-clinics, resulting in 198,826 medical consultations and 78,801 teleconsultations.
In the fiscal year 2022-23, the company achieved a revenue of Rs 1,428.76 crore, marking a significant increase of 71.6 percent from Rs 832.51 crore in the previous year. Its net income rose to Rs 163.89 crore from Rs 47.40 crore in the previous year. During the fiscal year, the overall asset quality improved, with gross NPAs reducing to 2.97 percent from 6.26 percent, and net NPAs falling to 0.6 percent from 1.55 percent.
About Muthoot Microfin:
Muthoot Microfin Limited is an Indian microfinance institution, which serves as the microfinance division of the Muthoot Pappachan Group. It primarily focuses on extending microloans to women entrepreneurs, with a specific emphasis on rural areas in India.
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