Manba Finance, a fast-growing non-banking financial company (NBFC), made a solid debut on the stock market on Monday, September 30, 2024. The company’s shares were listed at ₹145 on the NSE, representing a 20.83% premium over the IPO price of ₹120. Meanwhile, Manba Finance shares opened even higher on the BSE at ₹150, showing a 25% gain from its issue price.
This strong listing follows the overwhelming demand seen during the IPO subscription period, attracting substantial interest from retail and institutional investors.
Impressive IPO Subscription
The Manba Finance IPO was open for subscription from September 23 to September 25, 2024, and received a remarkable response from the market. The IPO was priced between ₹114 and ₹120 per share, and by the close of the bidding period, the issue was subscribed 224.05 times.
Breakdown of Subscription:
- Retail Investors: Subscribed 143.95 times
- Non-Institutional Investors (NII): Subscribed 511.62 times
- Qualified Institutional Buyers (QIB): Subscribed 148.55 times
The subscription numbers speak to the high level of confidence investors have in Manba Finance’s growth potential and its solid positioning within the financial sector.
About Manba Finance: Company Overview
Manba Finance is an NBFC primarily engaged in providing vehicle financing services, with a focus on two-wheelers. The company has been steadily growing, offering a range of financial products to cater to a diverse customer base.
With its deep expertise in vehicle financing, Manba Finance has built a strong foothold in the market, particularly in regions with high demand for two-wheeler financing.
Key Facts About Manba Finance:
- Founded: 1996
- Headquarters: Mumbai, India
- Core Business: Two-wheeler finance, vehicle loans
- Promoters: The IPO had no offer for sale (OFS) component, meaning the promoters did not offload their shares in the public issue.
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IPO Details and Allocation
The Manba Finance IPO aimed to raise ₹150.84 crore through a fresh issue of shares, without any OFS component. The funds raised will be used primarily to augment the company’s capital base and meet its future financial requirements.
Key Details of the IPO:
- Issue Size: ₹150.84 crore
- Shares Offered: 1.26 crore shares
- Price Band: ₹114-₹120 per share
- Minimum Application Size: 125 shares (requiring an investment of ₹15,000)
- Allotment Date: September 26, 2024
This IPO stood out due to its high subscription rate, reflecting strong market interest in the company’s growth strategy.
Listing Performance
Manba Finance’s strong debut on the NSE and BSE reflected investor confidence in the company’s future prospects. Listing at ₹145 on the NSE and ₹150 on the BSE, the stock closed with significant gains, showing continued upward momentum throughout the trading session.
The stock was buoyed by several factors, including:
- Overwhelming IPO subscription across investor categories.
- Positive market sentiment following the listing.
- Confidence in the company’s financial performance and growth outlook.
Future Growth Prospects
Looking ahead, Manba Finance is well-positioned to continue its growth trajectory. With a focus on expanding its reach in vehicle financing, the company plans to utilize the IPO proceeds to strengthen its capital base and expand operations in under-served markets.
Key Drivers for Future Growth:
- Vehicle Financing Demand: As India’s two-wheeler market continues to grow, particularly in rural and semi-urban areas, Manba Finance is well-positioned to capitalize on this trend.
- Strong Financial Metrics: The company’s improving Return on Capital Employed (RoCE) and reduced NPAs provide a solid foundation for future expansion.
- Digital Initiatives: Manba Finance is increasingly focusing on digital channels to provide easier access to financing solutions, especially for first-time buyers.
Why Should Investors Hold?
Market analysts have recommended that investors hold their positions in Manba Finance for the medium to long term. The company’s solid fundamentals and growth potential in the vehicle financing space make it an attractive investment.
Key Reasons to Hold:
- Impressive IPO subscription rate: Indicates strong investor confidence.
- Expansion plans: With a focus on increasing its customer base and geographical reach.
- Growing RoCE margins: Signaling improved profitability.
- Reduction in NPAs: Reflecting better financial management and lower credit risk.
According to Akriti Mehrotra, a Research Analyst at Stoxbox, “Manba Finance Ltd’s offering saw impressive demand, and its listing reflects that. Investors should hold their shares for the medium to long term, given the company’s solid growth trajectory and future expansion plans.”
Comparing Manba Finance to Other Recent IPOs
| Key Metrics | Manba Finance | IPO A | IPO B |
|---|---|---|---|
| IPO Subscription | 224.05 times | 150.62 times | 195.33 times |
| Retail Subscription | 143.95 times | 100.75 times | 120.85 times |
| Listing Day Premium | 21% | 17% | 12% |
| Fundraising Amount | ₹150.84 crore | ₹200 crore | ₹180 crore |
Manba Finance’s strong debut stands out among other recent IPOs, with its high subscription rate and solid listing day performance marking it as one of the top IPOs of the year.
Conclusion
The successful listing of Manba Finance is a testament to the company’s strong business fundamentals and growth prospects. With the overwhelming demand for its IPO and a 21% premium over the issue price, the company has laid the foundation for future growth in the NBFC space.
Investors who have been allotted shares should consider holding them for the medium to long term, given the company’s solid financials, expansion plans, and the growing demand for vehicle financing in India.
Disclaimer: The information in this article is for informational purposes only and does not constitute investment advice. Investors should consult with a certified financial advisor before making any investment decisions.
