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Business News/ Opinion / Online-views/  Muthoot Finance to raise Rs1,400 cr through IPO
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Muthoot Finance to raise Rs1,400 cr through IPO

Muthoot Finance to raise Rs1,400 cr through IPO

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New Delhi: Gold financing company Muthoot Finance will raise up to Rs1,400 crore through an initial share sale offer, which is expected to begin in the last week of this month.

Capital market regulator Sebi had in December approved the initial public offering (IPO) of Muthoot Finance. As per the draft prospectus filed with Sebi, the company will issue 5.15 crore shares through the IPO, which will see it divest a 13.85% stake.

Investment banking sources said the company will come out with the share sale offer in the last week of March and aims to raise somewhere between Rs1,200-1,400 crore.

Rating agency Crisil had assigned a grade of “four on five" to the proposed IPO, indicating above average fundamentals.

Kerala-based Muthoot Finance is a non-deposit taking, non-banking finance company (NBFC). It is primarily in the business of lending to individuals against used household gold jewellery.

The IPO proceeds will be utilised to augment the company’s capital base for meeting future capital requirements, for funding of loans and for general corporate purposes.

ICICI Securities, Kotak Mahindra Capital and HDFC Bank are the book running lead managers to the issue.

Shares offered through the IPO are proposed to be listed on the National Stock Exchange and the Bombay Stock Exchange. The pricing of IPO will be based on the book-building method.

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Published: 10 Mar 2011, 06:49 PM IST
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