Akme Fintrade (India) Limited IPO

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i. Akme Fintrade is a non-banking finance company (“NBFC”) incorporated in the year 1996 registered with the Reserve Bank of India as a Non-systemically important non-deposit taking company with over two decades of lending experience in rural and semi-urban geographies in India. They are primarily engaged in rural and semi-urban centric lending solutions to look after the needs and aspirations of rural and semi-urban populace.

ii. Their portfolio includes Vehicle Finance and Business Finance Products to small business owners. They have a long history of serving rural and semi-urban markets with high growth potential and have maintained a track record of financial performance and operational efficiency through consistently high rates of customer acquisition and retention and low cost expansion into underpenetrated areas.

iii. Their digital lending platform www.aasaanloans.com is currently under development and will be rolled out in a phased manner.

iv. The company has its footprints in rural and semi-urban geographies in 4 Indian states Rajasthan, Maharashtra, Madhya Pradesh and Gujarat through registered office located at Udaipur, Rajasthan, 7 branches and over 20+ points of presence including digital and physical branches having served over 2,00,000 customers till date.

v. Our Key Borrowers
1. Individuals
2. Small business owners

vi. Company’s Products 
1. Vehicle financing, comprising of Used Commercial Vehicle,
2 Wheeler Loans, Used 2 Wheeler Loans and 2. Business Finance to small business owners and SME/MSME business owners.

vii. Competitive strengths:

i. Proven execution capabilities with a strong rural and semi-urban focus
ii. Well established Vehicle Finance, small businesses lending business
iii. Stable and experienced management team

 

Objects of the Akme Fintrade (India) Limited IPO:

The company proposes to utilize the Net Proceeds from the Issue towards augmenting the capital base of the company to fulfil its future capital requirements, which are anticipated to arise as a result of the expansion of the business and assets. Further, a portion of the proceeds from the Issue will be used towards meeting Issue-related expenses.

Akme Fintrade (India) Limited IPO Details:

Open Date: Jun 19 2024
Close Date: Jun 21 2024
Total Shares: 11,000,000
Face Value: ₹ 10 Per Equity Share
Issue Size: 132.00 Cr.
Lot Size: 125 Shares
Issue Price: ₹ 114 - 120 Per Equity Share
Listing At: NSE,BSE
Listing Date: Jun 26 2024

Promoters And Management:

Mr. Nirmal Kumar Jain, is the Chairman and Managing Director of the Company. He has been on the Board of Directors of the Company from August 25, 1996. He is a qualified Chartered Accountant. He has been awarded with CA Business Leader Corporate (2nd Rank) at the C.A. Corporate Leader Exxact Awards Function organized by Committee for Members in Industry of The Institute of Chartered Accountants of India on January 20, 2008 and Certificate of Appreciation for his voluntary work/sponsorship with Impetus (NGO) for charity work during the Kerala Flood Relief that was conducted from August 19, 2018 to August 25, 2018 by Impetus. He has more than 25 years of experience in the finance terrain. He has played a significant role in the growth of the Company. Mr. Ramesh Kumar Jain is an Executive Director of the Company. He has been associated with the Company since 2016. He handles the Maharashtra Region Business and looks after all the activities of the Mumbai branch office of the Company. He has more than 7 years of experience. Mr. Rajendra Chittora is an Executive Director of the Company. He has been associated with the Company since December 29, 2020. He holds degrees in Bachelor of Science, Mohanlal Sukhadia University, Udaipur Master of Science in Electronics, Sukhadia University, Udaipur and MBA in Business Development from Mohanlal Sukhadia University, Udaipur. He has been awarded the Long Service Award for his contribution to Tata Motorfinance for 10 years by Tata Motorfinance. He has more than 10 years of experience in the auto finance sector.

Financials of Akme Fintrade (India) Limited IPO:

Particulars (in Cr) Mar-2021 Mar-2022 Mar-2023 9M-FY24
Net Interest Income 84 65 63 51
Other Income 3 2 3 2
Total Income 87 67 69 53
Finance Cost 48 35 28 21
Other Expenses 12 14 18 12
Profit before Provisioning 27 18 23 20
Provisioning 8 11 3 5
Profit after Provisioning 19 8 20 15
PAT 16 4 16 12
Loan Book 421 351 354 379
NNPA 2.97% 4.06% 3.45% 1.94%
ROE 12.52% 3.01% 7.72% 5.64%

Comparison With Peers:

Name of the Companies Revenue (Cr) Profit (Cr) ROE NNPA (as of 9MFY24) CMP AUM (In Cr)
Akme Fintrade (India) Limited 69 16 7.72% 1.94% 120 354
MAS Financial Services Ltd 989 206 15.20% 1.52% 305 8500
Cholamandalam Investment and Finance Company Ltd. 12884 2665 20.02% 3.10% 1460 1,06,498
Arman Financial Service Limited 424 94 29.50% 0.20% 2418 1942
CSL Finance Limited 117 46 15.20% 0.35% 459 736

Recommendation on Akme Fintrade (India) Limited IPO:

Review and Recommendation of Akme Fintrade (India) by team IZ is 4/10. 1. They are a non-banking finance company (NBFC) incorporated in 1996 and registered with the Reserve Bank of India as a Non-systemically Important Non-deposit Taking Company. They  specialize in providing financial services to rural and semi-urban geographies in India. 2. Geographic Presence They operate in four Indian states: Rajasthan, Maharashtra, Madhya Pradesh, and Gujarat. Their registered office is located in Udaipur, Rajasthan, and their corporate office is in Mumbai, Maharashtra. They have a network of 12 branches and over 25 points of presence, both digital and physical, serving over 200,000 customers to date. 3. Key Borrowers i. Individuals                       ii. Small Business Owners 4. Product Offerings Their business operations are divided into two principal lines: i. Vehicle Financing: This includes Used Commercial Vehicle Loans, Two-Wheeler Loans, and Used Two-Wheeler Loans. ii. Business Finance: Targeted at small business owners and SME/MSME business owners. 5. Sources of Funds They maintain a diversified funding profile through established relationships with lenders and investors, which include various banks, offshore financial institutions, and other NBFCs. Their funding sources include: i. Equity Shares issuance.                              ii. Loans from banks/financial institutions. iii. Issuance of redeemable non-convertible debentures.       iv. Subordinated debts. 6. Competition The NBFC sector in India is highly competitive, with main competitors being banks and other NBFCs. Key competitive factors include product range, customization capabilities, speed of loan approvals, pricing, reputation, and customer relationships. 7. The Revenue has Decreased from Rs.84 Crores in FY21 to Rs.63 Crores in FY23. 8. The PAT has Decreased from 16.3 Crores in FY21 to 15.8 Crores in FY23. 9. As per FY24, EPS is 3.82 and P/E is 31.36x. 10. Market Capitalization is 512 Crores.

Lead Manager of Akme Fintrade (India) Limited IPO:

  1. Gretex Corporate Services Private Limited

Registrar of Akme Fintrade (India) Limited IPO:

  1. Bigshare Services Private Limited

Company Address:

Akme Fintrade India Ltd AKME Business Centre (ABC), 4-5 Subcity Centre, Savina Circle opp Krishi Upaz Mandi Udaipur,- 313002 Phone: +91- 294-2489501 Email: cs@aasaanloans.com Website: https://aasaanloans.com/

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