Manba Finance IPO Opens Soon: Key Details You Need to Know About the ₹151 Crore Offering – Price, Lot Size, and Dates Revealed

Manba Finance is launching its Initial Public Offering (IPO) on Monday, September 23. The offer will remain open for bidding until Wednesday, September 25. The company aims to raise ₹150.84 crore by issuing 1.26 crore new shares. The price for each share is set between ₹114 and ₹120, and retail investors can buy a minimum lot of 125 shares. At the highest price, one lot will cost ₹15,000, and retail investors can apply for up to 13 lots.

IPO Allocation

• 50% for Qualified Institutional Buyers (QIBs)
• 15% for Non-Institutional Investors (NIIs)
• 35% for Retail Investors

About Manba Finance

Manba Finance is a non-banking financial company (NBFC) that offers loans for various vehicles, including two-wheelers, three-wheelers, electric vehicles, and personal loans. Headquartered in Mumbai, the company operates across 66 locations through 29 branches in six states: Maharashtra, Gujarat, Rajasthan, Chhattisgarh, Madhya Pradesh, and Uttar Pradesh. The majority (97.9%) of its loans go toward financing new vehicles, with average ticket sizes of ₹80,000 for two-wheelers and ₹1,40,000 for three-wheelers.

How the Company Plans to Use the Funds

The proceeds from the IPO will strengthen the company’s financial base, helping meet future capital needs. Listing the shares on the stock exchanges will also enhance the company’s visibility and help create a public market for its shares in India.

Dealer Network and Growth

Manba Finance has a vast network of over 1,100 dealers, including more than 190 EV dealers, across its six key states. The company’s employees are placed at these dealerships to assist customers in purchasing two-wheelers, three-wheelers, or electric vehicles. This close relationship with dealers plays an essential role in the company’s business, as they act as sales points for Manba’s financial products.

Asset Under Management (AUM) Growth

Manba’s AUM has grown from ₹495.82 crore in Fiscal 2022 to ₹936.85 crore in Fiscal 2024, reflecting a growth rate of 37.46% per year. This growth comes mainly from an increase in the number of loans, while ticket sizes and yields have remained steady. The company’s success in vehicle loans is driven by a business model focused on both customers and dealers, offering tailored solutions through special schemes and incentives.

Expanding into New Loan Products

Manba Finance is diversifying by offering loans for used cars, small businesses, and personal loans. Used car loans will range from ₹2 lakh to ₹6 lakh, mainly targeting existing two-wheeler loan customers looking to upgrade. Manba has also started offering small business loans in Maharashtra, ranging from ₹75,000 to ₹10 lakh, and personal loans up to ₹1 lakh.

Funding Sources

The company finances its operations through loans from public and private sector banks, small finance banks, financial institutions, and by issuing non-convertible debentures (NCDs). Total borrowings in Fiscal 2024 amounted to ₹752.27 crore, compared to ₹595.93 crore in Fiscal 2023. The average cost of borrowing during these years was around 11.98%.

Financial Performance

In Fiscal 2024, Manba’s revenue from operations increased by 43.71% to ₹191.59 crore, compared to ₹133.32 crore in Fiscal 2023. Interest income grew by 34.73%, while profit after tax rose 89.50%, reaching ₹31.42 crore in Fiscal 2024, up from ₹16.58 crore the previous year.

Key Risks

1. Geographic Concentration: Manba’s operations are concentrated in just six states. Any negative events in these regions could hurt the company’s performance.
2. Competitive Market: The company faces strong competition in the lending sector, which could affect its business if it doesn’t adapt to changing customer needs.
3. Operational Risks: A portion of the company’s recoveries is made in cash, exposing it to risks like fraud or theft.

Listing Details

The Manba Finance IPO allotment is expected to be finalized on Thursday, September 26, 2024. The shares will be listed on both the NSE and BSE, with a tentative listing date of September 30, 2024.