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Manba Finance IPO: Things Smart Investors Need to Know

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Manba Finance Limited, a well-established NBFC, is set to launch its initial public offering (IPO) from September 23 to September 25, 2024. With a focus on providing financial solutions for two-wheelers, three-wheelers, and small business loans, the company has shown robust growth in recent years. This IPO is an opportunity for retail investors to become a part of a promising business that caters to both urban and semi-urban markets.

The IPO size is Rs 150.84 crore, comprising a fresh issue of 1.26 crore shares, and will list on BSE and NSE. The offering price band is set between ₹114 and ₹120 per share, making it a great investment option for long-term investors.

Manba Finance IPO Details and Objectives

Manba Finance is raising Rs 150.84 crore through this IPO to augment its capital base and meet future growth requirements. The company intends to use these funds to support its expanding portfolio, particularly in vehicle financing for two-wheelers, three-wheelers, and electric vehicles.

Purpose of the IPO

The primary objective is to expand the company's capital base and support its growth strategies in the non-banking financial services sector.

Expected Funds to be Raised

The total expected fund raise is ₹150.84 crores, entirely from the fresh issue of shares.

Key Dates to Remember

  • IPO Open Date: Monday, September 23, 2024
  • IPO Close Date: Wednesday, September 25, 2024
  • Basis of Allotment: Thursday, September 26, 2024
  • Initiation of Refunds: Thursday, September 26, 2024
  • Credit of Shares to Demat Accounts: Friday, September 27, 2024
  • Listing Date: Monday, September 30, 2024
  • Cut-off Time for UPI Mandate Confirmation: 5 PM on September 25, 2024
     

Pricing and Lot Size of Manba Finance IPO

  • Price Band for the IPO: ₹114 to ₹120 per share, offering flexibility for investors.
  • Minimum Lot Size: 125 shares, which requires a minimum investment of ₹15,000 for retail investors.
  • Investment for sNII: 14 lots (1,750 shares), amounting to ₹210,000.
  • Investment for bNII: 67 lots (8,375 shares), amounting to ₹1,005,000.
  • Total Issue Size: The IPO consists of a fresh issue of 12.57 million shares, aggregating up to ₹150.84 crores.
  • Listing At: The shares will be listed on both BSE and NSE, with a tentative listing date of September 30, 2024.

How to Apply for the Manba Finance IPO?

Investors can apply for the Manba Finance IPO through various online methods:

Online Application Process

  • Step 1: Log in to your trading account linked to your Demat account.
  • Step 2: Navigate to the IPO section and select Manba Finance IPO.
  • Step 3: Choose the number of shares and the price within the specified range.
  • Step 4: Complete the UPI mandate or ASBA process to block funds.
  • Step 5: Submit your application.

Financial Health and Performance

Key Financial Metrics

  • Revenue (FY 2024): ₹191.63 crores, a 44% increase from FY 2023.
  • Profit After Tax (FY 2024): ₹31.42 crores, reflecting a 90% growth from the previous year.
  • Total Assets: ₹973.75 crores as of March 31, 2024.
  • Net Worth: ₹200.61 crores as of FY 2024.
  • Total Borrowing: ₹752.27 crores, showcasing the company’s borrowing strength.

Recent Performance and Growth Prospects

  • Manba Finance has demonstrated growth, with significant increases in revenue and profits between FY 2023 and FY 2024.
  • The company's financials and strategic expansions in vehicle and small business loans signal strong growth potential for the future.

Investment Risks and Opportunities

While Manba Finance offers growth potential, there are certain risks associated with the IPO.

Potential Risks:

  • High Debt/Equity Ratio: 3.75
  • Fully Priced Issue: Based on FY24 earnings, the IPO appears to be fully priced, which may limit short-term gains.

Opportunities:

  • Strong Demand for Two-Wheeler Financing: Growing demand for affordable vehicle financing, especially in urban and semi-urban areas.
  • Expanding EV Market: Increasing focus on financing electric two-wheelers and three-wheelers presents a lucrative growth opportunity.

Conclusion

Manba Finance IPO offers a solid investment opportunity for long-term investors, especially those interested in the financial services and vehicle financing sectors. The company’s consistent performance, coupled with growth prospects in electric vehicles, makes it a notable IPO to watch.

Frequently Asked Questions

What is the Manba Finance IPO, and why is it significant?

Answer Field

The Manba Finance IPO is a fresh issue of ₹150.84 crores, with 1.26 crore shares being offered. As a key player in the NBFC sector, the company focuses on financing two-wheelers, three-wheelers, and personal loans, making this IPO significant for investors interested in the financial services sector.

What is the price band for the Manba Finance IPO, and how was it determined?

Answer Field

The price band for the Manba Finance IPO is set between ₹114 and ₹120 per share, determined by the company's financial health, market performance, and overall demand in the sector.

What are the key risks and rewards of investing in the Manba Finance Ltd IPO?

Answer Field

Risks include a high debt-to-equity ratio and the fact that the issue is fully priced. However, rewards include the company’s growth potential, especially in the electric vehicle financing market, which presents long-term opportunities.

When will the Manba Finance IPO shares be listed, and what is the expected market response?

Answer Field

The shares listing date on September 30, 2024. The market response is anticipated to be moderate, considering the fully priced nature of the issue, but long-term prospects are promising.

What documents should I review before investing in the Manba Finance IPO?

Answer Field

Investors should review the Draft Red Herring Prospectus (DRHP), Red Herring Prospectus (RHP), and the company’s financial reports for a complete understanding of the IPO and its potential.

How will the Manba Finance Ltd IPO impact existing shareholders?

Answer Field

The issuance of fresh shares will result in dilution for existing shareholders, reducing their overall ownership percentage post-IPO.

Will Manba Finance IPO pay dividends?

Answer Field

Dividend payouts will depend on the company’s future earnings and capital requirements. There are no guarantees of immediate dividends following the IPO.

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