IPO Watch: Muthoot Microfin raises Rs 285 crore via pre-IPO placement to 26 investors

Muthoot Microfin has raised Rs 285 crore by selling part stake to anchor investors in the pre-IPO placement.

The company has allocated 97,93,812 shares to 26 anchor investors. These include foreign portfolio investors like Morgan Stanley, Societe Generale, Copthall Mauritius Investment.

Among domestic institutional investors, a string of insurance companies, including ICICI Prudential Life Insurance, HDFC Life Insurance, Bajaj Allianz Life Insurance, Kotak Mahindra Life Insurance, and SBI General Life Insurance have been allotted shares in the pre-IPO placement.


The initial public offering of Muthoot Microfin will open for subscription on December 18. The issue closes on December 20. The company's shares are expected to get listed on both the exchanges.

The IPO comprises a fresh issue of Rs 760 crore and an offer-for-sale (OFS) of Rs 200 crore.

Under the OFS, promoters Thomas John Muthoot, George Muthoot, Preethi John Muthoot, Remmy Thomas and investor Greater Pacific Capital will offload shares.The price band of this public issue is fixed at Rs 277-291. Investors can bid for 51 shares in 1 lot and in multiples thereafter.

Muthoot Microfin is the fourth largest microfinance company in India in terms of gross loan portfolio. It is the third largest in south India, and the largest in Kerala in terms of market share, and a key player in Tamil Nadu with an almost 16% share.

The microfinance firm aims to augment its capital base through the proceeds from the initial public offering. As per the RBI regulations, microfinance institutions are required to maintain a minimum capital adequacy of 15% consisting of tier-I capital and tier-II capital.

About 50% of the offer is reserved for qualified institutional buyers, 35% for retail investors and the rest 15% for non-institutional investors.

According to market analysts, Muthoot Microfin is trading at a premium of around Rs 88 in the unlisted market or grey market.

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