Northern Arc Capital IPO Overview
Northern Arc Capital has recently launched its Initial Public Offering (IPO), which has garnered significant interest from investors. With the IPO subscription showing robust demand, the overall response has been nothing short of impressive. By the third day of the subscription period, the IPO has been subscribed a staggering 20.18 times, indicating strong investor confidence in the company’s potential for growth.
IPO Subscription Details
| Investor Category | Subscription Rate |
|---|---|
| Qualified Institutional Buyers (QIB) | 0.31 times |
| Non-Institutional Investors (NII) | 50.80 times |
| Retail Investors | 18.97 times |
| Employees | 4.32 times |
| Total | 20.18 times |
IPO Financial Details
Northern Arc Capital aims to raise a total of ₹777 crore through this IPO, offering shares in the price range of ₹249 to ₹263 each. The IPO opened for subscriptions on September 16 and will continue until September 19, 2024. Investors have the opportunity to purchase shares in lots of 57. Notably, employees subscribing to this IPO will receive a discount of ₹24 per share.
The allotment of shares is scheduled to be finalized on September 20, and the shares will subsequently be listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) on September 24. The registrar managing this IPO is Kaffin Tech.
Allocation of Funds
Out of the total ₹777 crore to be raised, ₹500 crore will be generated from the issuance of new shares. Additionally, 1,05,32,320 existing shares, each with a face value of ₹10, will be offered under the Offer for Sale (OFS) component. The funds generated through the Offer for Sale will go directly to the selling shareholders, while the capital raised via new shares will primarily support the company’s funding requirements for loan distribution.
Grey Market Premium
The grey market has shown a robust demand for Northern Arc Capital’s shares, with the IPO currently trading at a premium of ₹168 in the unlisted market. If this trend continues, the company’s shares are expected to debut at approximately ₹431 upon listing, which would signify an impressive potential profit of 63.88% for investors. However, it is essential to note that this premium has seen a decline from previous days.
About Northern Arc Capital
Established in 2009, Northern Arc Capital specializes in diverse retail loan offerings. The company primarily focuses on financing for Micro, Small, and Medium Enterprises (MSMEs), microfinance institutions (MFIs), consumer loans, vehicle finance, affordable housing finance, and agricultural finance. With over a decade of experience in MSME financing and nine years in consumer finance, Northern Arc has built a reputation for reliability and growth within the financial sector.
Financial Performance
From a financial perspective, Northern Arc Capital has demonstrated steady improvement over the years. The company’s net profit surged from ₹181.94 crore in the fiscal year 2022 to ₹317.69 crore in the fiscal year 2024, reflecting a robust trajectory of growth. Moreover, the company has enjoyed an impressive compound annual growth rate (CAGR) of over 44% in revenue, reaching ₹1,906.03 crore during the same period.
Final Thoughts
The Northern Arc Capital IPO presents an exciting investment opportunity, driven by strong demand and solid financial performance. As the subscription period continues, potential investors should consider the company’s market position and growth potential before making their decisions. Always seek advice from qualified financial experts prior to investing to ensure that your investment strategy aligns with your financial goals.
