The initial public offering (IPO) of affordable housing financer India Shelter Finance Corporation will open for subscription on December 13. The company, backed by WestBridge Capital and Nexus Venture Partners, has fixed price band at ₹469-493 per share and looks to raise ₹1,200 crore at the upper end of the issue price. The bidding for anchor book will open for a day on December 12, while the shares are expected to be listed on the BSE and NSE on December 20.
The lot size of the IPO is 30 shares and in multiples thereof, which means the minimum application amount will be ₹14,790 for one lot and maximum will be ₹192,270 for 13 lots or 390 shares. The company has reserved half of the issue for qualified institutional buyers (QIBs), 15% for non-institutional investors (NIIs) and remaining 35% for retail investors.
As per the updated prospectus filed with the SEBI, the Gurugram-based housing financing company has reduced its IPO size by 33% from ₹1,800 crore mentioned in the initial document filed with SEBI in August this year. The company has reduced the fresh equity issue size to ₹800 crore from ₹1,000 crore announced earlier, while the offer for sale (OFS) part has been cut in half to ₹400 crore from ₹800 proposed in the DRHP.
Under the OFS, Catalyst Trusteeship Limited (as trustee of Madison India Opportunities Trust Fund), and Nexus Ventures III are the biggest selling shareholders, paring stakes worth ₹171.3 crore and ₹142.5 crore, respectively. Among others, Catalyst Trusteeship Limited (as trustee of MICP Trust), Madison India Opportunities IV, and MIO Starrock are also offloading shares via OFS.
The firm's promoters - WestBridge Crossover Fund and Aravali Investments Holdings – hold shareholdings of 24% and 31.4%, respectively, while founder Anil Mehta owns a 1.7% stake in the company.
IndiaShelter Home Loans intends to use the fund raised from the issuance of fresh equities to meet future capital requirements towards onward lending. The fund will be partially utilised for general corporate purposes.
Incorporated in 1998, India Shelter Finance Corporation provides home loans and loans against property to customers in the low and middle-income segments. As of March 31, 2023, 97.5% of India Shelter loans had one or more borrowers as women. Out of this, more than 50% of women own properties in their name or joint parties.
In an interaction with Fortune India, Rupinder Singh said that the company targets first-time home loan borrowers in Tier I and Tier 2 cities. “From the beginning, the focus was to take care of self-employed people instead of the salaried population in the low and middle-income segments with an aim to promote financial inclusion.”
In line with its financial inclusion vision, the company aims to empower women by ensuring that a majority of its loans have women as the first applicants, he says. “The company seeks to help address problems arising from patriarchy in Indian society and inculcate a feeling of security and independence in women.”
Between the financial year 2021 and 2023, the firm registered a two-year CAGR growth of 40.8% in terms of assets under management (AUM), as per CRISIL report. This growth was achieved on the back of better asset quality with a gross NPA of 1.13% as of March 31, 2023, which was among the best in affordable housing finance companies in India.
As of March 31, 2023, India Shelter Finance had a network of 183 branches spread across 15 states with a significant presence in the states of Rajasthan, Maharashtra, Madhya Pradesh, Karnataka, and Gujarat.
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