Fusion Microfinance has filed its draft IPO (Initial Public Offering) papers with the capital markets regulator SEBI. Backed by private equity firm Creation Investment and an arm of Warburg Pincus, Fusion Microfinance is a economic services firm serving in rural and semi-rural India. The business is searching to raise Rs 600 crore from a fresh situation of equity and an supply for sale (OFS) by current shareholders which includes promoters Devesh Sachdev, Creation Investments Fusion, and Warburg Pincus backed Honey Rose Investment. On listing the business could join listed peers such as Ujjivan Small Finance Bank, Suryoday Small Finance Bank, and Bandhan Bank amongst other people.
Fusion Microfinance is searching to raise Rs 600 crore as element of the IPO via and issuance of fresh equity shares along with an OFS of 2,19,66,841 equity shares. Of this up to 13,00,000 shares will be sold by Devesh Sachdev, up to 2,00,000 by Mini Sachdev, up to 63,21,375 by Honey Rose Investment, 40,00,000 by Creation Investment Fusion. Other promoting shareholders will include things like Oikocredit, Ecumenical Development Co-operative Society U.A and Global Financial Inclusion Fund.
From the funds raised via the fresh situation, Fusion Microfinance mentioned, it will raise the capital base of the Company. Funds raised via the OFS will go towards the promoting shareholders. Prior to the IPO, promoters and Promoter Group of Fusion Microfinance hold more than an 85.5% stake in the business. The other two promoting shareholders of the business with each other hold a 12.03% stake in the business. Fusion Microfinance mentioned it could go for a pre-IPO placement of Rs 120 crore.
According to the DRHP, Mini Sachdev — on the promoting shareholders, acquired 4,500 equity shares of the business in one year prior to the filing of DRHP at an typical price of Rs 290.48 per share. Meanwhile, promoter Devesh Sachdev’s typical price of acquisition of his whole shareholding is Rs 117.16, though the price of acquisition for Warburg Pincus’ Honey Rose Investment is reported at Rs 194.94 per share.
Fusion Microfinance has seen its earnings develop from Rs 497 crore in the economic year 2018-19 to Rs 873 crore in the earlier economic year. Net profit of the business was Rs 50 crore in the economic year 2018-19, which improved to Rs 69 crore in the economic year 2019-20 prior to falling to Rs 43.9 crore in the earlier covid-struck economic year. Half of the IPO of Fusion Microfinance will be reserved for Qualified Institutional Buyers, though retail investors can bid for 35% of their situation. Non-Institutional Investors will get to subscribe 15% of the IPO size, the DRHP mentioned.