Northern Arc Capital IPO: High Investor Interest
Northern Arc Capital is witnessing impressive investor enthusiasm for its Initial Public Offering (IPO), with subscriptions reaching an astounding 9.99 times by the end of the second day. The IPO has garnered bids for approximately 21.45 crore shares against the 2.14 crore shares available, reflecting robust demand. The company is looking to raise approximately ₹777 crore from this offering, with a price band set between ₹249 and ₹263 per share. Investors will have the opportunity to participate in this IPO until September 19.
Subscription Details
| Investor Category | Subscription Rate |
|---|---|
| Qualified Institutional Buyers (QIB) | 0.20 times |
| Non-Institutional Investors (NII) | 21.72 times |
| Retail Investors | 10.84 times |
| Employees | 2.25 times |
| Total Subscription | 9.99 times |
IPO Details
Investors can participate in the Northern Arc Capital IPO with a lot size of 57 shares. Employees have a unique advantage, receiving a discount of ₹24 per share. The IPO opened on September 16 and is set to close on September 19, with share allotments to be finalized on September 20. The shares are anticipated to list on the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) on September 24. Kaffin Tech has been appointed as the registrar for this offering.
Funding Structure
The IPO consists of fresh shares worth ₹500 crore being issued, alongside an Offer for Sale (OFS) of 1,05,32,320 shares with a face value of ₹10. The funds procured from the Offer for Sale will go to the respective selling shareholders, while the new share proceeds will be aimed at enhancing the company’s capability to provide loans, fulfilling its capital requirements.
Grey Market Premium (GMP)
The IPO is experiencing significant traction in the grey market, where it is reportedly trading at a premium of ₹202. This premium indicates a potential listing price of ₹465, rendering a remarkable return of approximately 76% for investors if this listing price materializes.
About Northern Arc Capital
Founded in 2009, Northern Arc Capital has established itself as a leader in retail lending, with a primary focus on Micro, Small and Medium Enterprises (MSMEs), microfinance, consumer financing, vehicle financing, affordable housing finance, and agricultural finance. The company boasts approximately 15 years of experience in MSME finance and 9 years in consumer finance, demonstrating its long-standing expertise in the financial sector.
Financial Growth
The company has shown consistent financial improvement over the years. In fiscal year 2022, it reported a net profit of ₹181.94 crore, which surged to ₹242.21 crore in FY 2023 and further escalated to ₹317.69 crore in FY 2024. During this period, Northern Arc Capital’s revenue grew at a commendable compound annual growth rate (CAGR) of over 44%, reaching approximately ₹1,906.03 crore.
