Home First Finance IPO Price Band, Equity Shares and Valuations II Key details explained

The Issue of Equity Shares of Home First Finance Company aggregating upto Rs 1153.72 Cr (Fresh Issue of Equity shares aggregating upto ₹ 265 Cr and Offer for sale of Equity shares aggregating upto ₹ 888.72 Cr). The number of shares to be issued is 22315639 – 22272556 and the Face value is Rs 2 per share. The Price band is Rs 517 -  Rs 518 and the bid Lot is of 28 Shares and in multiple thereof. Post Issue Implied Market Cap of the Home First Finance Company would be Rs 4518 – Rs 4527 cr.

Home First Finance Compan Issue opens on Thursday, 21st Jan’2020 and Issue closes on Monday, 25th Jan2020 while the Anchor Investor Bidding date should be on 20th of Jan’ 2020. The Book Running Lead Managers are Axis Capital, Credit Suisse, ICICI Securities, Kotak Mahindra Capital and the Registrar is KFin Technologies. The grey market premium of Home First Finance Company is Rs 90 – Rs 100.

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Issue highlights:

Incorporated on Feb 3, 2010, Home First Finance Company India Limited (“Home First Finance”) is a technology driven affordable housing finance company that targets first time home buyers in low and middle income groups.

The Company Promoters are True North Fund V LLP and Aether (Mauritius) Ltd. Further, Bessemer has invested in the company since January 2011 and Orange Clove Investments B.V. (an affiliate of Warburg Pincus, a global private equity investor) has acquired a stake in the company in October 2020.

The company primarily offers customers housing loans for the purchase or construction of homes, which comprised 92.1% of the Gross Loan Assets, as of Sept 30, 2020. The Gross Loan Assets have grown at a CAGR of 63.4% between the financial years 2018-2020 and increased to Rs 3730 cr as of Sept 30, 2020.

The company serves salaried and self-employed customers. Salaried customers account for 73.1% of its Gross Loan Assets and self-employed customers account for 25% of Gross Loan Assets as of Sept 30, 2020. They serviced 44,796 active loan accounts, as of Sept 30, 2020.

The company has unique features viz. holistic technology usage, deep distribution in relevant markets, unique people strategy, data Science backed underwriting, analytics driven electronic collection and diversified financing profile.

The company has High quality housing finance portfolio; resilient through Covid-19 having above 96% collection efficiency. Home First Finance Company has Scalable Operating Model with over 3600 cr AUM. As of September 30, 2019, they had a network of 70 branches covering over 60 districts in 11 states and a union territory in India, with a significant presence in the states of Gujarat, Maharashtra, Karnataka and Tamil Nadu. This accounted for approximately 79% of the affordable housing finance market in India during the financial year 2019.