CreditAccess Grameen Limited IPO
(i) CreditAccess Grameen Limited IPO Overview
(a) CreditAccess Grameen Limited (formerly known as Grameen Koota Financial Services Pvt. Ltd.) was born out of the need for timely and affordable credit to India’s poor and low-income households.
(b) Grameen Koota was founded in May 1999 as a project under the T. Muniswamappa Trust (TMT), an NGO in South Bangalore. Grameen Trust, Bangladesh, provided seed capital funding to TMT to replicate the Grameen Bank Bangladesh microfinance model.
(c) In 2007, the microfinance activities of Grameen Koota was transferred from NGO to a well-regulated and registered Non-Banking Financial Company (NBFC). In 2013, it subsequently got reclassified into a regulated and governed Non-Banking Financial Company-Micro Finance Institutions (NBFC-MFI). Grameen Koota continues to be the operating brand name of CreditAccess Grameen Limited (formerly known as Grameen Koota Financial Service Private Limited).
(d) They are a leading Indian microfinance institution headquartered in Bangalore, focused on providing microloans to women customers predominantly in Rural Areas in India who largely lack access to the formal banking sector and present a latent opportunity for offering microloans. According to CRISIL Research, they were the third largest NBFC-MFI in India in terms of the gross loan portfolio as of March 31, 2017.
(ii) CreditAccess Grameen Limited IPO Business Model
a) Their main focus customer segment is women having an annual household income of ₹160,000 or less in Urban Areas and ₹100,000 or less in Rural Areas. They provide loans primarily under the joint liability group (“JLG”) model. Their primary focus is to provide income generation loans to their Customers, which comprised 86.81% of the total JLG loan portfolio, as of September 30, 2017.
b) They also provide other categories of loans such as Family welfare loans, Home improvement loans, and Emergency loans to their existing Customers.
c) In 2016, with a view to diversifying the product profile, they introduced individual Retail finance loans for those who were their Customers for at least three years. They offer these loans to customers to establish a new enterprise or expand an existing business in their individual capacity (for instance, for the purchase of inventories, machinery or two-wheelers).
(iii) CreditAccess Grameen Limited IPO Expansion Strategy
a) They followed a strategy of contiguous district based expansion across regions and, as of September 30, 2017, they cover 112 districts in the five states of Karnataka, Maharashtra, Tamil Nadu, Chhattisgarh and Madhya Pradesh in India through 440 branches and 3,783 loan officers.
b) Their operations are well -diversified at the district level, with no single district contributing more than 5% to their Gross AUM (apart from one which contributed less than 6% to their Gross AUM) as of September 30, 2017.
c) The customer base increased from 0.50 million Active Customers as of March 31, 2014, to 1.61 million Active Customers as of September 30, 2017. The company has excellent Active Customer Retention Rate of 90%.
Objects of the CreditAccess Grameen Limited IPO:
CreditAccess Grameen Limited IPO Details:
|Open Date:||Aug 08 2018|
|Close Date:||Aug 10 2018|
|Face Value:||₹ 10 Per Equity Share|
|Issue Type:||Book Built Issue IPO|
|Issue Size:||1131.2 Cr.|
|Lot Size:||35 Shares|
|Issue Price:||₹ 418-422 Per Equity Share|
|Listing Date:||Aug 23 2018|
Promoters And Management:
|(i) Authorized Share Capital 160,000,000 Equity shares at FV@10)||160 Cr|
|(ii) Issued, Subscribed,& Paid-up Share Capital Before Issue (128,427,337 Equity Shares at FV@10)||128.427 Cr|
|(iii) Present Issue OFS to public ( 11,876,485 Equity Shares at FV@10)||11.8765 Cr|
|(iv) Present Issue Fresh Shares ( 14,928,910 Equity Shares at FV@10)||14.928 Cr|
|(v) Reservation for QIB (13402697.5 Equity Shares at FV@10)||50%|
|(vi) Reservation for HNI (4020809.25 Equity Shares at FV@10)||15%|
|(vii) Reservation for Retail (9381888.25 Equity Shares at FV@10)||35%|
|(viii) Paid Up Share Capital after the issue||143.355 Cr|
Financials of CreditAccess Grameen Limited IPO as per DRHP:
|1. Assets and Liabilities Key Parameters|
|Year||Asset(Cr)||Liabilities(Cr)||Net Worth(Cr)||Book Value||ROA|
|2. Profit n Loss Key Parameters|
|Year||Revenue(Cr)||PAT(Cr)||AUM(cr)||NIM||NPA(cr)||Gross NPA||Shares( Cr)|
|3. Cash Flow Statement(all figures in Cr)|
|(i) Net Cash Generated from Operation||-1,739.16||-424.79||-931.09||-698.42||-270.92|
|(ii) Net Cash Generated from Investment||53.545||-4.892||-3.946||-0.871||2.999|
|(iii) Net Cash Generated from Financing Activity||1483.539||579.10||934.36||597.41||489.70|
|(iv) Total[ (i)+(ii)+(iii) ]||-202.08||149.42||-0.68||-101.88||221.79|
|Cash at the Start||332.11||182.68||183.36||285.24||63.457|
|Cash at the End||130.03||332.11||182.68||183.36||285.24|
Comparison With Peers:
|Company||AUM(Cr)||AUM CAGR Growth||Borrowing Cost||NIM||ROA||G.NPA||CAR||P/B||P/E|