Aadhar Housing Finance IPO Review –
Aadhar Housing Finance Limited is coming up with its IPO which is set to open from 8th May 2024 to 10th May 2024. This article will analyze the financials , strengths and weaknesses of the Aadhar Housing Finance IPO. Keep scrolling below to read more!
Company Overview –
Aadhar Housing Finance Limited a housing finance company (HFC) was established in 2010, that caters to the low income housing segment. It serves economically weaker and low-to-middle-income customers who require small-ticket mortgage loans.
Aadhar Housing Finance offers a range of products like :
- Mortgage-related loan products, including loans for residential property purchase and construction.
- Home improvement and extension loans
- And, loans for commercial property construction and acquisition.
As of December 31, 2023, company has branches and sales offices in 20 states and union territories in India, operating in 10,926 pin codes via its 487 branches, including 109 sales offices.
IPO Synopsis-
Aadhar Housing Finance Limited IPO is set to be open from 8th May 2024 to 10th May 2024, offering fresh issue of 31,746,032 shares worth Rs. 1000 Cr and and Offer-for-Sale (OFS) of 63,492,063 shares worth Rs. 2000 Cr.
The total issue size of this IPO amounts to Rs.3000 Cr. The company has allocated shares 35% to retail investors, 50% to institutional and 15% to non institutional investors.
| Particulars | Details |
| Opening Date | 8th May 2024 |
| Closing Date | 10th May 2024 |
| Lot Size | 47 Shares |
| Face Value | Rs. 10 |
| IPO Size | Rs. 3000 Cr |
| Fresh Issue | Rs. 1000 Cr |
| IPO Price Range | Rs. 300 – 315 |
| Min. Investment | Rs. 14,100 |
| Offer for Sale (OFS) | Rs. 2000 Cr |
| Basis of Allotment | 13th May 2024 |
| Refunds | 14th May 2024 |
| Listing Date | 15th May 2024 |
| DRHP Draft Prospectus: | Click Here |
| RHP Draft Prospectus: | Click Here |
Book Running Lead Managers –
- ICICI Securities Limited
- Citigroup Global Markets India Private Limited
- Kotak Mahindra Capital Company Limited
- Nomura Financial Advisory and Securities (India) Private Limited
- SBI Capital Markets Limited
Registrar to the offer –
The registrar for the IPO is KFin Technologies Limited. They are responsible for ensuring the IPO allotment and refund processes are carried out smoothly.
The Objective Of The Issue –
- To meet future capital requirements towards onward lending : The Company plans to utilize ₹750 crores from the raised funds towards maintaining capital which will help them to remain competitive with its peers.
- General corporate purposes : The Company plans to deploy the balance of the funds towards meeting expenses incurred in the ordinary course of business.
Financial Status –
| Particulars(in Rs. Crores) | FY 23 | FY 22 | FY 21 |
|---|---|---|---|
| Revenue From Operations | 2043.23 | 1728.27 | 1575.33 |
| EBIDTA | 1536.50 | 1341.81 | 1259.67 |
| PAT | 544.76 | 444.85 | 340.13 |
| Total Assets | 16617.87 | 14375.81 | 13630.33 |
| Total Borrowings | 12920.21 | 11229.12 | 10937.51 |
Peers of Aadhar Housing Finance –
- Aptus Value Housing Finance India Limited – High P/E ratio and moderate EPS
- Aavas Financiers Limited – Strong P/E ratio, High EPS
- Home First Finance Company India Limited – High P/E ratio and EPS
- India Shelter Finance Corporation Limited – Good P/E ratio and EPS
IPOs Strengths –
- Company has a seasoned business model with strong resilience through business cycles.
- Extensive branch and sales office network across India covering almost 10,926 pin codes.
- Access to diversified and cost effective long term financing
- Strong focus on HFC focused on low income housing segment and runs with a social motive of making a difference.
- Company has a experienced management team and dedicated professional.
IPOs Weakness –
- Any significant increase in NPA in the AUM can adversely affect the company.
- To comply with the regulations and guidelines issued by regulatory authority of India.
- Operates in highly competitive industry
- Company always need high working capital requirements.
- In the past company has reported negative cash balance.
Conclusion –
Considering the positive revenue and profitability trends, along with a strengthening capital base and efficient cost management, investing in this IPO could be considered. The upcoming IPO represents a promising opportunity for investors growing life sciences industry but comes with its fair share of risks and challenges.
However, if any IPO is oversubscribed and GMP sustained is more than 50% then the IPO is considered good for investment. This IPO is going to open from Wednesday, 08 May 2024. After the opening of the IPO, its GMP and demand will be known.
However, investors should conduct further due diligence, analyze industry trends and the competitive landscape, and consider risk factors before making an investment decision. Experienced investors can apply for the IPO after carefully evaluating all factors to maximize their gains.
