Manappuram Finance shares under pressure as Sebi temporarily suspends arm Asirvad Micro Finance's IPO

Share market today: Manapurram Finance's shares slipped for the second straight session on Wednesday, January 10, and touched the day's low of Rs 163.4 apiece on BSE after capital markets regulator Sebi temporarily suspended the initial public offering (IPO) of its arm, Asirvad Microfinance. The size of the IPO proposed was Rs 1,500 crore.

At around 10:05 a.m., shares of Manappuram Finance were down 4.47 per cent or Rs 7.9, at Rs 168.65 apiece on the BSE. The market capitalisation of the company at around the same time stood at Rs 14,275.12 crore.

About Asirvad Micro Finance IPO

On October 5, Asirvad Micro Finance, a subsidiary of Manappuram Finance, filed a Draft Red Herring Prospectus (DRHP) with SEBI. The maiden public issue is purely a fresh issue of equity shares with no offer-for-sale (OFS) component, according to the prospectus.

The company also planned to raise up to Rs 300 crore in a pre-IPO round. The proceeds from the issue will be used to augment the capital base of the company to meet future business requirements.

JM Financial, Kotak Mahindra Capital Company, Nomura Financial Advisory and Securities (India) Private Ltd, and SBI Capital Markets are the book-running lead managers to the issue. Equity shares of the company were to be listed on the BSE and NSE.

As per Zee Business research, Manappuram bought a 97.6 per cent stake in Asirvad Micro Finance in FY15.

Asirvad Micro Finance's financials

Asirvad Micro Finance's asset under management (AUM) was Rs 10,000 crore in FY23, and its total market share in the gross loan portfolio is 3 per cent. The company has a total of 33 lakh clients.

Manappuram Finance share price: Past performance

In a year, shares of Manappuram Finance have gained over 37 per cent as against the Nifty 50's rise of over 20 per cent.

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(With inputs from the agencies.)