Mumbai-based Manba Finance Ltd., a leading Non-Banking Financial Company (NBFC), is set to launch its initial public offering (IPO) on September 23, 2024. Investors and market enthusiasts are eagerly eyeing this public issue, as the company plans to raise funds to enhance its capital base and fuel future growth. In this article, we will walk you through all the key details regarding the Manba Finance IPO, including the price band, lot size, key dates, and more.
Manba Finance IPO: Price Band and Key Details
Manba Finance has set its IPO price band between ₹114 to ₹120 per equity share, with a face value of ₹10 per share. This gives investors an affordable entry point into the company, especially considering its strong presence and rapid growth in the two-wheeler loan market.
Lot Size
Investors interested in subscribing to the Manba Finance IPO can place bids for a minimum of 125 equity shares and in multiples of 125 shares thereafter. This flexible bidding structure allows both small retail investors and larger institutions to participate in the offering.
Fresh Issue
The IPO will include a fresh issue of up to 1,25,70,000 shares, with no portion being allocated for sale by existing shareholders. The net proceeds from this public offering will primarily be used to strengthen the capital base, enabling Manba Finance to support its future expansion plans.
Company Overview: Manba Finance’s Journey and Expansion
Founded in 1998, Manba Finance started as a small NBFC in Mumbai, focusing primarily on vehicle loans. Over the years, the company has successfully expanded its operations to cover multiple states and product lines.
Today, Manba Finance operates from 66 locations connected to 29 branches across six states in western, central, and northern India. The company’s presence is well-established in urban, semi-urban, and rural markets, giving it access to a broad range of customers.
In recent years, the company has diversified its product offerings, now providing Used Car Loans, Small Business Loans, and Personal Loans, in addition to its core vehicle financing operations. This diversification strategy positions the company to tap into growing markets, using its existing distribution network for further market penetration.
Dealer Network and Market Reach
Manba Finance boasts an impressive network of over 1,100 dealers, including 190 electric vehicle dealers, across Maharashtra, Gujarat, Rajasthan, Chhattisgarh, Madhya Pradesh, and Uttar Pradesh. This extensive dealership network has played a pivotal role in boosting the company’s sales and ensuring a strong foothold in the highly competitive vehicle financing industry.
Loan Portfolio and AUM Growth
Manba Finance’s loan portfolio primarily consists of New Vehicle Loans, which make up 97.90% of its total lending operations. The company’s average loan size is around ₹80,000 for two-wheeler loans and ₹1,40,000 for three-wheeler loans. This focus on vehicle financing has allowed the company to maintain a steady growth trajectory in its Assets Under Management (AUM).
As of FY 2024, Manba Finance’s AUM reached an impressive ₹936.85 crore, up from ₹495.82 crore in FY 2022, reflecting a CAGR of 37.46% over the period. This growth underscores the company’s ability to capture market share and expand its customer base in a competitive landscape.
Funding Terms and Loan Approval Process
Manba Finance funds up to 85% of the vehicle’s on-road price, with financing decisions based on various factors, including loan-to-value (LTV) ratios, the customer’s credit score (CIBIL), and their financial profile. The company’s internal credit policies ensure a swift and efficient loan approval and disbursement process, which has helped attract a broad base of both salaried and self-employed individuals.
Financial Performance
In terms of financial performance, Manba Finance has shown steady growth across key metrics:
- Net Profit (FY 2024): ₹39.07 crore
- Revenue (FY 2024): ₹313.54 crore
- Net Profit (FY 2023): ₹32.31 crore
- Revenue (FY 2023): ₹249.89 crore
This consistent growth highlights the company’s robust business model and its ability to scale effectively.
Key Dates for Manba Finance IPO
- IPO Open Date: September 23, 2024
- IPO Close Date: September 27, 2024
- Anchor Investor Bidding Date: September 24, 2024
- Listing Date: October 3, 2024 (Tentative)
The IPO will be listed on both the BSE and NSE.
Utilization of Funds
The net proceeds from the IPO will be allocated towards strengthening the capital base, which will enable Manba Finance to support its future growth initiatives. The funds will be used to:
- Expand the company’s loan portfolio
- Finance its branch expansion strategy
- Fund general corporate purposes
Manba Finance’s Competitive Position
Manba Finance holds a dominant position in the two-wheeler financing market, where it controls a significant share of loans disbursed. In FY 2024, the company held 92% of its AUM in two-wheeler loans, making it one of the leading players in this segment.
The company’s AUM per branch was recorded at ₹14.41 crore, positioning it third among peers like Arman Financial, Hero Fincorp, MAS Financial, and TVS Credit. With a 40.3% CAGR in branch growth between FY 2022 and FY 2024, Manba Finance is on track to continue its rapid expansion.
Conclusion: Why Manba Finance IPO?
The Manba Finance IPO offers a compelling investment opportunity for both retail and institutional investors. With a robust track record, diversified product offerings, and strong financial performance, the company is well-positioned to capture further market share in the vehicle financing sector and beyond.
Investors looking to benefit from Manba Finance’s growth trajectory should consider subscribing to this IPO, especially given the company’s strategic expansion into new product lines and markets.
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