India Shelter Finance IPO entails to raise Rs 1200 crores. India Shelter Finance is a retail-focused affordable housing finance company with an extensive distribution network and a scalable technology infrastructure. India Shelter Finance Corporation is a housing finance player, which provides loans for house construction, extension, renovation and purchase of new homes or plots.
IPO opens
December 13,, 2023
IPO Closes
December 15, 2023
IPO Size (Rs.)
₹ 1,200 Cr
IPO Size (shares)
24,340,771 shares
Breakup
Fresh issue ₹800 Cr + OFS ₹400 Cr
Face Value:
₹5/-
IPO Price in Rs :
₹469 to ₹493
Minimum Lot
30 Shares
Listing At
NSE , BSE
Anchor & QIB Quota
50%
NII Quota
15%
Retail Quota
35%
Lead Manager
Kotak ,Citigroup, ICICI Securities, Ambit
Registrar
Kfin Technologies
About India Shelter Finance:
India Shelter Finance is a retail-focused affordable housing finance company with an extensive distribution network and a scalable technology infrastructure.
h an extensive distribution network comprising 203 branches as of September 30, 2023.
Its target segment is the self employed customer with a focus on first-time home loan takers in the low and middle-income group in Tier II and Tier III cities in India, and affordable housing loans
The company offers home loans up to Rs 50 lakhs to urban households for construction, extension, renovation and purchase of new homes.
As of September 30, 2023, 70.7% of their customers were first-time home loan takers.
Company is promoted by Westbridge whose 55% pre-IPO holding will come down to 47% post IPO.
2/3rd of its AUM is across Rajasthan, Maharashtra, Madhya Pradesh, Karnataka and Gujarat.
Financials: India Shelter Finance
Particulars / Rs. In crore
2023 (06)
2022 (06)
2023 (12)
2022 (12)
2021 (12)
Revenue from Operations
385.99
264.65
584.53
447.98
316.71
Revenue Growth (%)
45.85%
–
30.48%
41.45%
–
EBITDA
281.79
180.69
418.83
320.86
222.63
Profit before Tax
138.36
81.18
201.95
166.90
112.96
Net Profit for the period
107.35
62.02
155.34
128.45
87.39
Share Capital
45.02
43.73
43.77
43.71
42.98
Reserves
1,329.94
1,098.28
1,196.76
1,032.42
894.29
Net Worth
1,374.97
1,142.01
1,240.53
1,076.13
937.27
EPS – Diluted (₹)
12
7.02
17.47
14.63
9.93
RONW (%)
8.20%
5.60%
13.4%
12.8%
9.8%
Net Asset Value (₹)
152.70
130.57
141.38
123.11
109.04
Post issue Share Capital
53.53
FV
5.0
IPO price
493.0
EPS Fy23
14.5
PE Fy23
34.0
EPS Fy24 (annualized)
20.1
PE Fy24 (annualized)
24.6
Market cap in Lacs
5,278.1
Market cap / Sales
19.94
Anchor: India Shelter Finance IPO: .
India Shelter Finance IPO: Salient Points
Between Financial Year 2021 and Financial Year 2023, India Shelter witnessed a 2-year CAGR growth of 40.8% in terms of assets under management.
The company has recorded 32% year-on-year growth in its total income at Rs 606 crore for the financial year ended March 2023. Profit for the same period rose 21% to Rs 155 crore.
Net proceeds from the fresh issue will be utilised towards augmenting Tier–I capital base to meet its future capital requirements, arising out of the growth of business and assets. A part of the proceeds will also be used for meeting offer expenses.
Company has posted a steady growth in its top and bottom lines
Company’s target segment is the self-employed customer with a focus on first time home loan takers in the low and middle income group in Tier II and Tier III cities in India.
Shareholders holding 1% or more of the issued, subscribed and paid-up share capital of Company
Aravali Investment Holdings, Mauritius is a wholly-owned subsidiary of WestBridge Crossover Fund, LLC,
WestBridge Crossover Fund, LLC has also made investments in Aptus Value Housing Finance India Limited,
The company has recorded 32% year-on-year growth in its total income at Rs 606 crore for the financial year ended March 2023. Profit for the same period rose 21% to Rs 155 crore.
They have higher cost of borrowing at 8.9% compared to peers due to A+ credit rating which lower than both Aptus and Home Plus’ AA- rating.
Post IPO networth will move to ₹2000 cr, and may gives them a chance for rating upgrade.
Peers:
Company
Price/Adj BV
RoA
Net NPA
NIM
PE
India Shelter Finance
2.5
3.60%
0.72%
6.00%
34 (24.6)
Aptus Value
4.3
7%
0.89%
13.30%
30.1
Aavas Financer
3.5
3.10%
0.66%
8.00%
26.6
Home First Finance
4.9
3.30%
1.20%
5.50%
32.8
India Shelter Finance IPO is coming at a PE ratio of 34x (FY23) and 24.6x (FY24 annualized).
BFSI / Home Finance stocks are ruling at average multiples.
GMP as reported on social media is Rs. 150.
I intend to apply in India Shelter Finance IPO. Two investors Nexus and Madison, with holding 29% combined will be eligible for exit after 6 months when lock in expires. This may put pressure on stock. Valuation look just OK at this stage.
Please do your own diligence.
Standard disclaimer: I am not a SEBI registered analyst and above analysis is for educational purpose only. Iam a postgraduate in engineering & Management . Also Certified in some exams like NISM-Series-V-A: Mutual Fund Distributors Certification, NISM-Series-X-A: Investment Adviser (Level 1) Certification and NISM-Series-X-B: Investment Adviser (Level 2) Examination. This post is my view on the subject matter and is only academic and exploratory in nature. It is not meant to influence investment decisions of investors. I may have bias/vested interest in covered Stock/Mutual Funds/NCD etc. due to my own investment or leaning. Further my understanding of the areas on which I write may be imperfect or incomplete and data could be wrong due to limited time and resources at my disposal. Do check the data from company’s RHP and exchanges before making any decision. Please do your own due diligence as stock market/MF investments have high degree of inherent risk.