About the Company:
Muthoot Microfin, initially known as 'Panchratna Stock and Investment Consultancy Services,' is a leading microfinance institution in India, particularly focused on rural areas. As of March 31, 2023, it ranks as the 5th largest NBFC-MFI in India, 3rd largest in South India, and holds the largest market share in Kerala. It is a key player in Tamil Nadu, boasting a 16% market share. The company is part of the Muthoot Pappachan Group (MPG), a conglomerate engaged in various sectors.
MPG, with over 50 years in financial services, is the 2nd largest under the group in terms of AUM for FY2023. Muthoot Microfin has a strong association with MPG, benefitting from brand recall and operational advantages. Their gross loan portfolio, as of September 30, 2023, stands at Rs 10,867.07 crore, with income-generating loans contributing 93.97%. Their joint liability group model, exclusively for women in lower-income households, aids in financial inclusion and new income opportunities.
With 0.32 crore active customers and 12,297 employees across 1,340 branches in 339 districts, they focus on under-served rural markets for accessibility. The "Mahila Mitra" app, launched in 2021, enhances digital collections with features like QR codes and SMS-based links. Currently, 0.15 crore customers have downloaded the app, and 0.25 crore have conducted digital transactions. The company is working on a Super App in collaboration with MPG to integrate Mahila Mitra with MPG's products onto a single platform.
Promoters Shareholding:
The promoters of the company are Thomas John Muthoot, Thomas Muthoot, Thomas George Muthoot, Preethi John Muthoot, Remmy Thomas, Nina George and Muthoot Fincorp Limited.
| Share Holding Pre Issue | 69.08% |
| Share Holding Post Issue | 55.47% |
IPO Objectives:
- Utilization of Funds:
- The company aims to use the Net Proceeds from the Fresh Issue to increase its capital base for future financial requirements.
- Objectives in Memorandum of Association:
- The main and ancillary objectives outlined in the Memorandum of Association enable the company to:
- Continue existing business activities.
- Undertake activities funded by the Net Proceeds.
- The main and ancillary objectives outlined in the Memorandum of Association enable the company to:
- Listing Benefits:
- Listing Equity Shares on Stock Exchanges is expected to yield several advantages, such as:
- Enhancement of brand image among existing and potential customers.
- Creation of a public market for Equity Shares in India.
- Listing Equity Shares on Stock Exchanges is expected to yield several advantages, such as:
Summary of Financial Information:
| Period Ended | 31 Mar 2023 | 31 Mar 2022 | 31 Mar 2021 |
| Assets | 8,529.20 | 5,591.46 | 4,183.85 |
| Revenue | 1,446.34 | 842.94 | 696.28 |
| Profit After Tax | 163.89 | 47.40 | 7.05 |
| Net Worth | 1,625.85 | 1,336.58 | 889.89 |
| Reserves and Surplus | 1,282.15 | 1,040.10 | 642.84 |
| Total Borrowing | 6,493.18 | 3,996.61 | 3,015.66 |
Key Performance Indicators:
| KPI | Values |
| P/E (x) | 24.96 |
| Post P/E (x) | 25.38 |
| Market Cap (Rs Cr.) | 4960.82 |
| ROE | 11.06% |
| Debt/Equity | 3.99 |
| EPS (Rs) | 11.98 |
| RoNW | 10.08% |
Comparison with Peers:
| Company Name | EPS (Basic) | EPS (Diluted) | NAV (per share) (Rs) | P/E (x) | RoNW (%) |
|---|---|---|---|---|---|
| Muthoot Microfin Limited | 14.19 | 11.98 | 139.15 | 24.96 | 10.08 |
| Equitas Small Finance Bank Limited | 4.71 | 4.67 | 46.44 | 17.57 | 11.12 |
| Ujjivan Small Finance Bank Limited | 5.88 | 5.87 | 20.25 | 6.33 | 27.79 |
| CreditAccess Grameen Limited | 52.04 | 51.82 | 326.89 | 26.67 | 16.18 |
| Spandana Sphoorty Financial Limited | 1.74 | 1.74 | 436.58 | 381.72 | 0.40 |
| Bandhan Bank Limited | 13.62 | 13.62 | 121.58 | 17.32 | 11.21 |
| Suryoday Small Finance Bank Limited | 7.32 | 7.32 | 149.28 | 22.31 | 4.90 |
| Fusion Micro Finance Limited | 43.29 | 43.13 | 230.74 | 12.60 | 16.67 |
Key IPO Details:
| IPO Date | December 18, 2023 to December 20, 2023 |
| Listing Date | December 26, 2023 |
| Face Value | Rs. 10 per share |
| Price Band | Rs. 277 to Rs. 291 per share |
| Lot Size | 51 Shares |
| Total Issue Size | 32,989,690 shares (aggregating up to Rs. 960.00 Cr) |
| Fresh Issue | 26,116,838 shares (aggregating up to Rs. 760.00 Cr) |
| Offer for Sale | 6,872,852 shares of Rs. 10 (aggregating up to Rs. 200.00 Cr) |
| GMP | Rs. 80 (27.49%) [Only for information purpose] |
Note: For additional information & risk factors please refer to the Red Herring Prospectus
Disclaimer: We are not SEBI registered. All the views are personal and only for educational purposes. Do your due diligence before making any trading or investing decisions. The data provided in this blog post is for illustrative purposes only and does not constitute financial advice. Always consult with a qualified financial advisor before making investment decisions.
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