10 things to know about Fusion Micro Finance IPO that opens from Nov 2 to Nov 4

Nov 2, 2022

By: Bhakti Makwana

IPO dates

The IPO of New Delhi-based microfinance company that provides financial services to underserved women across India opens its IPO for subscription on November 2 and closes on November 4. The price band of the IPO is set at ₹350-368 a share.

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How much money will the company raise via IPO?

The total issue size of the IPO is ₹1,103 crore, which includes fresh issue of ₹600 crore. The rest of it is an offer for sale of 1.36 crore equity shares by the company's shareholders and promoters.

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What does the company do?

The microfinance lender’s business runs on a joint liability group-lending model, wherein a small number of women form a group (typically comprising five to seven members) and guarantee one another's loans.

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More about the company

The company has 2.9 million active borrowers served through a network of 966 branches, 9,262 permanent employees across 377 districts in 19 states and union territories in India, as of June 30, 2022.

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Profit shrunk consistently

Fusion Micro Finance has been reporting a fall in profits consistently for the last three fiscal years while revenue continues to rise throughout.

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Key risk

Increase in the level of NPAs or provisions may adversely affect business, financial condition, operations and cash flows of the company in the future, say analysts.

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Where will IPO money be used?

The proceeds from the IPO will be utilised towards augmenting the capital base of the company.

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High grey market demand

The grey market premium (GMP) of the company’s shares stand at ₹40 per share. GMP is the premium at which IPO shares are traded in an unofficial market before they are listed on the stock exchanges.

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Allotment date

The company’s shares are scheduled to be allotted on November 10.

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Listing date

Fusion Micro Finance will be listed on BSE and NSE on November 15.

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