Fusion Microfinance shares fall more post listing at discount to IPO issue price

Market


Shares of Fusion Micro Finance Ltd made a dull stock market debut on Tuesday with the stock listing at 359 apiece on the NSE, a discount of over 2% as compared to its IPO issue price of 368 per share. On the BSE, Fusion Microfinance shares started trading at 360 apiece, and fell further to 333 in the afternoon deals.

CRISIL’s Ratings has upgraded its long-term rating on the bank facilities and non convertible debentures of Fusion Micro Finance Limited (Fusion) to ‘CRISIL A/Stable’ from ‘CRISIL A-/Stable’ ahead of the company’s listing.

“The revision in the rating is driven by substantial increase in capital position of the company and expected improvement in profitability. Fusion has completed raising fresh equity of 600 crore recently which is around 43% of existing networth. Post this capital raise, Fusion’s overall networth will rise over 2,000 crore from 1,416 crore as of June 30, 2022,” the rating agency said on Monday.

The Initial Public Offering (IPO) was subscribed 2.95 times on Friday, the last day of subscription that concluded on November 4, 2022. The 1,104-crore IPO received bids for 6,30,36,040 shares against 2,13,75,525 shares on offer, as per data available with the NSE. The issue had a price band of 350-368 a share.

Fusion Microfinance IPO had a fresh issue of up to 600 crore and an offer for sale of up to 1,36,95,466 equity shares. It had a price range of 350-368 a share. Fusion Micro Finance raised a little over 331 crore from anchor investors. Net proceeds of the fresh issue will be used to augment the capital base of the microfinance firm.

The company decided to allot 89,99,943 equity shares to anchor investors at 368 apiece, aggregating the transaction size to 331 crore. Nomura, BNP Paribas Arbitrage, Aditya Birla Sun Life Mutual Fund, ICICI Prudential Mutual Fund, Edelweiss Mutual Fund, Motilal Oswal Mutual Fund, HDFC Life Insurance Company, Bajaj Allianz Life Insurance Company and Kotak Mahindra Life Insurance Company are among the anchor investors.

The New Delhi-based microfinance company claims to provide financial services to underserved women across India in order to facilitate their access to greater economic opportunities. 

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