Leading NBFC-MFI Company, focusing on the unserved and underserved states across the country; Arohan Financial Services Ltd has filed its IPO DRHP. As per market sources the company plans to raise between Rs. 1750-1800 cr.
The public offer comprises a fund raise via a fresh issuance of shares amounting to Rs. 850 cr. The Company will have an Offer for Sale (OFS) of 27,055,893 Equity shares by Maj Invest Financial Inclusion Fund II K/S, Michael & Susan Dell Foundation, Tano India Private Equity Fund II, TR Capital III Mauritius and Aavishkaar Goodwell India Microfinance Development Company II Ltd; collectively.
The portion reserved for Qualified Institutional Buyers will be upto 50% of the offer, Non-Institutional Investors will have upto 15% of the portion reserved while upto 35% will be reserved for the Retail Investors. The portion reserved for eligible employees will be upto 5% of the offer.
As stated in the DRHP, the company may decide to undertake a Pre IPO placement of Rs. 150 cr subject to consultation of the merchant bankers. The net proceeds from the fresh issue will be utilized for augmenting the company's capital base to meet their future capital requirements which is expected to be deployed in FY22.
As on September 30, 2020, the Kolkata-based company which commenced its operations in 2006 has served approximately 2.21 million borrowers across 17 states and stands as the largest NBFC-MFI in Eastern India as per Gross Loan Portfolio, it offers a broad range of products across credit and financial instruments.
Between FY17-FY20, Arohan Financial Services, as per the CRISIL Report, had the 2nd highest Gross Loan Portfolio growth at 68% CAGR and stood amongst top 5 NBFC-MFIs in India. Arohan Financial also had the highest customer growth at 49% CAGR between FY18-FY20. The company's disbursements, AUM, Total Comprehensive income has been growing YOY and as on FY20 stood at a CAGR of 110.03%.
The microfinance business of the company operates out of 710 branches across 11 states and the MSME lending business has a reach across 8 states through its 10 branches.
Promoters Aavishkaar Group that provides business solutions to assist sustainable enterprises dedicated to social and environmental change caters to an AUM of approximately $ 1 bn across Asia.
Edelweiss Financial Services Ltd, ICICI Securities Ltd, Nomura Financial Advisory and Securities (India) Private Limited and SBI Capital Markets Limited are the BRLMS to the Issue.