Spandana Sphoorty Financial IPO – Review, Allotment, Subscription, GMP & more

Spandana Sphoorty Financial Limited is rural focused NBFC-MFI with a geographically diversified presence in India. It offers income generation loans under the joint liability group model,  mainly to women from low-income households. Spandana Sphoorty Financial IPO comprises of the Fresh Issue of up to X* Equity Shares aggregating up to Rs 4,000.00 million by the Company.

Let’s have a detailed review of the company and analytics of the Spandana Sphoorty Financial IPO release date, IPO offer price, subscription, Spandana Sphoorty Financial IPO allotment, grey market price and other details like the company’s background, its financial positions, its promoters and other related things.

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Spandana Sphoorty Financial IPO Review & Ratings

IPO Ratings & Review
CriteriaRatings
Industry Sentiments7.8/10
Industry Ranking7.7/10
Company Background7.9/10
Company Reputation7.4/10
Competitive Edge7.7/10
Financial Statements7.8/10
Popularity Index7.7/10
Promoters Reputation7.7/10
Retail Appetite7.4/10
Top Brokers Review7.4/10
Overall Ratings7.7/10
Star Ratings★★★★☆

Summary of Spandana Sphoorty Financial IPO

Spandana Sphoorty Financial IPOSpandana Sphoorty Financial Limited is rural focused NBFC-MFI with a geographically diversified presence in India. It offers income generation loans under the joint liability group model,  mainly to women from low-income households. The Offer comprises of the Fresh Issue and the Offer for Sale. The Company has not yet disclosed the shares to be offered in Initial public offer however it is comprising of the Fresh Issue of up to [●] Equity Shares aggregating up to Rs 4,000.00 million.

From FY 2014-15 to FY 2017-2018, as per the Restated Financial Statements:

  • In the past five years revenues have increased from INR 3286.33 lakhs in F. Y. 2014-15 to INR 3513.49 lakhs in F.Y. 2015-16, INR 3642.00 lakhs in F.Y. 2016-17 and to INR 5725.97 lakhs in F.Y. 2017-18 showing a high increment in recent years.
  • The restated profit after tax was Rs580.58 million, Rs1,072.96 million, Rs2,464.88 million and Rs420.58 million for Fiscals 2014, 2015, 2016 and 2017, respectively.
  • The net worth for Shareholders as on March 31, 2018 was Rs9,840.88 million and Rs9,840.62 million, as per the Restated Standalone Financial Information and Restated Consolidated Financial Information, respectively.

The Promoters of this company are Mr. Padmaja Gangireddy and Kangchenjunga Limited. The lead managers to the issue are AXIS CAPITAL LIMITED, ICICI SECURITIES LIMITED, IIFL HOLDINGS LIMITED, JM FINANCIAL , INDUSIND BANK, YES Securities Limited and the Registrar to this issue is KARVY COMPUTERSHARE PRIVATE LIMITED.


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    Spandana Sphoorty Financial IPO Date

    The opening and the closing date of IPO of Spandana Sphoorty Financial is not known yet.


    Spandana Sphoorty Financial IPO Subscription

     Subscription
    Day 1X
    Day 2 X
    Day 3X
    Day 4 X
    Day 5 X

    The shares subscribed by the public will be updated herein on a daily basis, once the IPO is open for subscription.


    Spandana Sphoorty Financial IPO Allotment Status

    The Offer comprises of the Fresh Issue and the Offer for Sale.Equity shares will be allocated on a proportionate basis to Retail Individual Applicants, subject to valid applications being received from Retail Individual Applicants at the Issue Price. The balance of the Net Issue will be available for allocation on proportionate basis to Non Retail Applicants.


    Spandana Sphoorty Financial IPO Price Band

    The Company has not yet disclosed the shares to be offered in Initial public offer however it is comprising of the Fresh Issue of up to [●] Equity Shares aggregating up to Rs4,000.00 million. Therefore the price band is also not disclosed.


    Spandana Sphoorty Financial Equity Share Offering

    The Offer comprises of the Fresh Issue and the Offer for Sale.


    Spandana Sphoorty Financial Limited – Company Overview

    Spandana Sphoorty Financial Private Limited was incorporated as a public company in 2003 and registered as an NBFC with the RBI in 2004. Subsequently, they registered as an NBFC-MFI in 2015. Between the years 2005 to 2010, it grew its micro-finance operations and, as of March 2010, we were the second largest MFI in terms of AUM.

    Spandana Sphoorty Financial Limited is rural focused NBFC-MFI with a geographically diversified presence in India. It offers income generation loans under the joint liability group model,  mainly to women from low-income households.

    Their business model involves regular client meeting processes through their employees, who maintain contact with the clients across the districts that they cover. As of March 31, 2018, they had 4,045 employees (including 2,746 credit assistants) operating out of 694 branches in 222 districts across 15 states in India.

    Through their loan products and clientcentric approach, they endeavor to strengthen the socio-economic well-being of low-income households by providing financing on a sustainable basis in order to improve livelihoods, establish identity and enhance self-esteem.

    Competitive Strengths of Spandana Sphoorty Financial Limited:

    • Seasoned business model with resilient performance through business cycles.
    • High degree of client engagement and robust risk management.
    • Streamlined systems and processes and high employee productivity.
    • Focus on the high potential and under-served rural segment.
    • Geographically diversified operations.

    Business strategies of Spandana Sphoorty Financial Limited:

    • Leverage the popular income generation loan product s to derive organic business growth.
    • Leverage the existing branch network by increasing loan portfolio and enhancing employee productivity
    • Increase the presence in under -penetrated states and districts.
    • Further diversify the borrowing profile and reduce their cost of borrowings.
    • Pursue inorganic growth through acquisitions.

    Spandana Sphoorty Financial Limited – Financial Statements

    A quick look into the past financial performance of the company to understand its performance of business and evaluate the growth prospectus:

    Financial Summary:

    Amount (in INR & Lakhs)
    31-Mar-1831-Mar-1731-Mar-1631-Mar-1531-Mar-14
    Total Assets35779.3224146.3220978.0223498.3121718.48
    Total Revenue5725.973642.003513.493286.332771.07
    Total Expense3448.803108.002287.552204.542189.79
    Profit After Tax1703.95420.582464.881072.6580.58

    Earnings per Equity Share (in Lakhs)

    31-Dec-1831-Mar-1731-Mar-1631-Mar-1531-Mar-14
    Basic EPS in Rs59.7120.61120.9452.9729.95
    Diluted EPS in Rs.38.540.522.981.250.63

    From the above statements, one could find that the Spandana Sphoorty Financial Limited may perform well.


    Spandana Sphoorty Financial IPO – Promoters

    The Promoters of this company are:

    1. Mr. Padmaja Gangireddy
    2. Kangchenjunga Limited

    List of Related Parties (Key Managerial Personnel)

    • Mr. Feroz Khan

    Interest in promotion of the Company

    Company is currently promoted by the Promoters in order to carry on its present business. Promoters are interested in the Company to the extent of their shareholding and directorship of the Individual Promoter in the Company and the dividend declared, if any, by the Company. The Promoters are interested in the transactions entered into the Company and the Promoter Group.

    Property Interest

    The promoters along with the promoter group will continue to hold collectively some percentage of the equity share capital of the company. As a result of the same, they will be able to exercise significant influence over the control of the outcome of the matter that requires approval of the majority shareholders vote.

    Interest in Intellectual Rights of the Company

    Promoters has not shown any interest in acquiring the intellectual rights of the company.


    Spandana Sphoorty Financial IPO Offer Details or Issue Details

     Particulars No. Of Equity Shares
     Equity Shares Offered Upto [●] Equity Shares of Rs.10 each  aggregating up to Rs[●] million
     Of which:
     FRESH ISSUE[●] Equity Shares of Rs.10 each  aggregating up to Rs4,000.00 million
    OFFER FOR SALEUpto 13,146,595 Equity Shares,aggregating   upto Rs.[●] million.
     Reserved for Market Makers [●] Equity Shares of Rs.10 each-
     Net Issue to the Public [●] Equity Shares of Rs.10 each
     Of which:
     Retail Investors Portion [●] Equity Shares of Rs.10 each
     Non-Retail Investors Portion[●] Equity Shares of Rs.10 each
     Equity Shares outstanding prior to the Issue59,633,683 Equity Shares of Rs.10 each
     Equity Shares outstanding after the Issue[●] Equity Shares of Rs.10 each

    Spandana Sphoorty Financial IPO Issue Object

    These are the IPO Issue Objects of the company

    •  To undertake its existing activities.
    • To raise funds.

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    Spandana Sphoorty Financial IPO – Basis of the Offer Price

    The issue price is determined by the company in consultation with the Lead manager on the basis of the following qualitative and quantitative factors.

    Qualitative factors are:

    • Seasoned business model with resilient performance through business cycles.
    • High degree of client engagement and robust risk management.
    • Streamlined systems and processes and high employee productivity.
    • Focus on the high potential and under-served rural segment.
    • Geographically diversified operations.

    The relevant quantitative factors are:

    Basic EPS
    in Rs.
    Diluted EPS in Rs.RONW (%)NAV in Rs.
    31-Mar-16120.942.98125.48(291.73)
    31-Mar-1720.610.527.81(127.36)
    31-Mar-1859.7138.5417.31(54.15)
    • Industry P/E Ratio:
    ParticularsP/E
    Highest566.6
    Lowest31.5
    Average133.6
    • Competitive Peers:
    CompanyStandalone/

    Consolidated

    EPS in Rs.P/E ratioNAV per share in Rs.RoNWFace value per share
    Bharat Financial
    Inclusion Limited
    Standalone32.8933.4215.215.1910
    Satin Creditcare
    Network Limited
    Consolidated0.261536229.70.3710
    Ujjivan Financial
    Services Limited
    Consolidated0.61566.6145.70.4110
    Bandhan Bank
    Limited
    Standalone12.2638.278.714.3410
    Bajaj Finance
    Limited
    Consolidated47.5437.2286.316.162
    Cholamandalam
    Investment &
    Finance Limited
    Consolidated62.4123.2330.3618.8910
    Shriram City
    Union Finance
    Limited
    Consolidated104.1820.5871.311.9510
    Sundaram Finance
    Limited
    Consolidated64.0426.1441.2415.6410
    Mahindra
    Mahindra
    Financial Services
    Limited
    Consolidated17.6226.2160.510.332

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    Spandana Sphoorty Financial IPO Lead Managers

    Lead Managers
    AXIS CAPITAL LIMITED,

    ICICI SECURITIES LIMITED,

    IIFL HOLDINGS LIMITED,

    JM FINANCIAL,

     INDUSIND BANK,

    YES Securities Limited

    Spandana Sphoorty Financial IPO Registrar to offer

    Registrar to the Offer
    Karvy Computershare Private Limited
    Karvy Selenium Tower B, Plot 31-32, Gachibowli
    Financial District, Nanakramguda, Hyderabad 500 032
    Telangana, India
    Tel: +91 40 6716 2222, Fax: +91 40 2343 1551
    E-mail: spandana.ipo@karvy.com
    Investor grievance E-mail: einward.ris@karvy.com
    Website: www.karisma.karvy.com
    Contact Person: M. Murali Krishna
    SEBI Registration No.: INR000000221

    Other Details:

    • Statutory Auditor –S.R. Batliboi & Co. LLP, Chartered Accountants

    Spandana Sphoorty Financial IPO Review by Top 10 Stock Brokers

    Top Stock Brokers ReviewCompany ReputationCompetitive EdgeFinancial StatementPopularity IndexPromoters Reputation
    Angel Broking6.5/106.6/106.6/106.4/106.4/10
    Sharekhan6.7/106.4/106.6/106.1/106.2/10
    Kotak Securities6.7/106.7/106.7/106.4/106.3/10
    ICICI Direct6.6/106.3/106.7/106.5/106.5/10
    IIFL6.4/106.7/106.8/106.4/106.7/10
    Edelweiss6.7/106.4/106.4/106.3/106.7/10
    Zerodha6.5/106.4/106.7/106.4/106.5/10
    5Paisa6.7/106.4/106.3/106.7/106.5/10
    Karvy6.8/106.3/106.7/106.4/106.0/10
    Motilal Oswal6.6/106.4/106.6/106.6/106.4/10

    The ratings would be updated once the financials and the other details of the IPO are released.


    Spandana Sphoorty Financial IPO Grey Market Premium

    The Spandana Sphoorty Financial IPO Grey Market Premium is yet to be announced. It will be updated as soon as the premium rates are announced.


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