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All that you should know about the Company before applying for the IPO.

October 31, 2022     

The public issue of equity shares of FUSION MICROFINANCE LIMITED will open for subscription on November 02, 2022 and closes on November 04, 2022. It is expected to list on the stock exchanges on November 15, 2022. What does the company do? Why is the company going public? Who are its key competitors? Its key strengths, and lot more. Here’s everything that you want to know about the company to analyse the IPO.

Company Profile

Since its inception in 2010, the company has been one of the youngest among the top 10 NBFC-MFIs in India in terms of AUM providing financial services to un-served and underserved women in rural and peri-rural areas across India. In addition, they had the fourth fastest gross loan portfolio CAGR of 53.89% between the financial years 2017-21 among the ten largest NBFC-MFIs in India.

The company has achieved a significant footprint across India and extended its reach to 2.90 million active borrowers. They serve these borrowers through their network of 966 branches spread across 377 districts in 19 states and union territories in India. In addition, they have 9,262 permanent employees. Their share of AUM from rural customers represented 91.37% of the total AUM and their focus customer segment is women in rural areas with an annual household income of up to ₹300,000. (As of June 30, 2022)

The company runs its business on a joint liability group-lending model, wherein a few women form a group (typically comprising five to seven members) and guarantee one another’s loans. This model ensures credit discipline through peer support within the group, enabling customers to manage finances prudently and promptly repay their loans. Their key product offerings include income-generating loans that provide capital for women entrepreneurs in rural areas to fund businesses operating in the agriculture-allied, agriculture, manufacturing, production, trade, retail, and services sectors.

Who are the Promoters of the Company?

Devesh Sachdev, Creation Investments Fusion, LLC, Creation Investments Fusion II, LLC and Honey Rose Investment Ltd.

Positives about the Company

  • Well diversified and extensive pan-India presence
  • Proven execution capabilities with strong rural focus
  • Access to diversified sources of capital and effective asset liability management
  • Robust underwriting process and risk management policies
  • Technologically advanced operating model
  • Stable and experienced management team supported by marquee investors

Who are its listed peers?

  • Credit Access Grameen Limited
  • Spandana Sphoorty Financial Limited
  • Bandhan Bank Limited
  • Ujjivan Small Finance Bank Limited
  • Equitas Small Finance Bank Limited
  • Suryoday Small Finance Bank Limited

Why is the Company going public?

Given below are the objectives of the Company –

The Offer comprises a Fresh Issue by the company and an Offer for Sale by the selling shareholders. The company will not receive any proceeds from the Offer for Sale.

The Company proposes to utilise the Net Proceeds from the Fresh Issue towards augmenting its capital base.

IPO Details

IPO Size ₹ 1103.99 Crore*
Offer Mix Fresh issue ₹ 600 Crore + Offer For Sell ₹ 503.99 Crore*
Price Band ₹ 350 - ₹ 368
Lot Size 40 Shares (& in multiples thereof)
Face Value ₹ 10
Application Amount Min. ₹ 14,720 (1 lot) | Max. ₹ 1,91,360 (13 lots) [at upper price band]
Listing on NSE & BSE
Registrar Link Intime India Private Limited
Cut-off time for UPI Mandate Confirmation 04-November-2022 (up to 05:00 PM)
* at upper price band

Category Wise Availability*

QIB ₹ 552.00 Crore
(50% of the Issue Size)
NIB ₹ 165.60 Crore
(15% of the Issue Size)
Retail ₹ 386.39 Crore
(35% of the Issue Size)
* at upper price band

Indicative Issue Timeline

Activity Date
IPO Opens November 02, 2022
IPO Closes November 04, 2022
Finalization of the basis of allotment November 10, 2022
Unblocking of funds / Initiation of refunds November 11, 2022
Credit of equity shares to Demat accounts November 14, 2022
Listing of equity shares November 15, 2022
Source: Company RHP  Alternate Text


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