Muthoot Finance subsidiary Belstar Microfinance to bring in 1,300 crore IPO files with SEBI

Muthoot Finance: Belstar Microfinance Limited, a subsidiary of Muthoot Finance, has decided to launch an IPO. The company has submitted its documents to market regulator SEBI to launch an IPO. The IPO of Belstar Microfinance will be around Rs 1,300 crore. From this, new shares worth around Rs 1,000 crore will be issued. Besides, around Rs 300 crore will be raised through the sale offer.

Large investors will sell their stake

According to the DRHP submitted by Belstar Microfinance, Danish asset management company MAJ Invest will sell its shares worth Rs 175 crore through an offer for sale. Apart from this, Arum Holdings will sell shares worth around Rs 97 crore and Augusta Investments Zero Pte will sell shares worth Rs 28 crore. MAJ Invest invested in Belstar Microfinance for the first time in 2018 and for the second time in 2022.

The Muthoot Finance subsidiary markets numerous products

Currently, Muthoot Finance holds approximately 66 percent stake in Belstar Microfinance. This subsidiary of Muthoot Finance markets different types of microfinance products. It provides loans to small and medium enterprises, consumer goods, festivals, education loans and emergency loans. The main objective of the company is to support self-help groups. As of December 31, 2023, the self-help group model represented approximately 57% of Belstar Microfinance’s total loan portfolio.

Muthoot Finance subsidiary Belstar Microfinance makes profits

The company will use the Rs 760 crore raised through this IPO to meet its future working capital requirements. The remaining money will be used to meet general business needs. Belstar Microfinance had made a profit of Rs 235 crore in the December quarter. Besides, the company’s turnover also stood at Rs 1,283 crore. The lead managers of this IPO will be ICICI Securities, Axis Capital, HDFC Bank and SBI Capital Markets.