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Muthoot Microfin Post IPO Analysis: Hold or sell

"Muthoot Microfin IPO: A Deep Dive into Subscription Status and Financial Performance"

The Muthoot Microfin IPO has been making waves in the market, with its subscription status reaching an impressive 11.52 times at the end of the third day. This article delves into the subscription journey, shedding light on its slow start, remarkable recovery, and the factors that make it the highest subscribed MFI IPO compared to its peers.

Let us Under Subscription Data of Muthoot Microfin IPO

Subscription Rollercoaster Of Muthoot Microfin IPO

Day 1: A Sluggish Start

The IPO had a sluggish start on the first day, garnering only 83% subscription. Despite this initial setback, the company exhibited resilience.

Day 2: Speedy Recovery

Surprisingly, on the second day, the Muthoot Microfin IPO was fully subscribed within minutes of opening, reflecting a remarkable turnaround from the slow start.

Day 3: Exponential Growth

By the end of the third day, the subscription status soared to an astonishing 11.52 times, showcasing the investors' overwhelming interest.

Retail and Non-Institutional Investors Response for Muthoot Microfin IPO

The retail and non-institutional investors' portion gradually gained momentum, ultimately leading to a fully booked retail and employee portion.

Financial Performance Overview of Muthoot Microfin IPO

Unraveling the financial intricacies is a pivotal step in decision-making. Our experts scrutinize Muthoot Microfin's balance sheets, income statements, and cash flow projections. By delving into the nitty-gritty of the financials, we aim to provide you with a clear picture of the company's fiscal health, helping you gauge its resilience against market fluctuations.

Fiscal Performance of Muthoot Microfin IPO

The financial performance of Muthoot Microfin over the last three fiscal years has been commendable. In FY21, the company posted a total income/net profit of Rs. 696.28 cr. / Rs. 7.05 cr., followed by Rs. 842.94 cr. / Rs. 47.40 cr. in FY22, and Rs. 1446.34 cr. / Rs. 163.89 cr. in FY23.

Spectacular Growth of Muthoot Microfin IPO

Notably, from H1 of FY24 onwards, the company marked a spectacular performance, earning a net profit of Rs. 205.26 cr. on a total income of Rs. 1047.24 cr.

Key Financial Metrics of Muthoot Microfin IPO

For the last three fiscals, Muthoot Microfin reported a fully diluted average EPS of Rs. 7.25 and an average RoNW of 6.35%. The issue is reasonably priced at a P/BV of 2.28 based on its NAV of Rs. 127.61 as of September 30, 2023, and at a P/BV of 1.91 based on its post-IPO NAV of Rs. 152.64 per share (at the upper cap).

P/E Ratio Analysis of Muthoot Microfin IPO

Annualizing FY24 earnings and attributing them to post-IPO fully diluted paid-up equity capital puts the asking price at a P/E of 12.08, indicating that the issue appears reasonably priced.

NPA Management of Muthoot Microfin

Muthoot Microfin showcases robust NPA management, with net NPAs standing at 0.33% as of September 30, 2023, compared to 0.60% as of March 31, 2023, 1.55% as of March 31, 2022, and 1.42% as of March 31, 2021. The company, focused on microfinance in rural areas and Joint Liability Group funding, has consistently demonstrated controlled NPAs.

Investment Perspective: Should Investors holr or sell Muthoot Microfin stock after  IPO Listing ?

Considering the steady growth and controlled NPAs, Muthoot Microfin's IPO appears to be a promising investment for medium to long-term rewards. Investors looking for a reasonably priced offering with strong financials may find this opportunity compelling.

In conclusion, the Muthoot Microfin IPO has not only weathered a slow start but has emerged as the highest subscribed MFI IPO. Its financial performance, with a focus on rural microfinance, signifies a robust foundation for potential investors. The issue's reasonable pricing and controlled NPAs make it an attractive option for those seeking sustainable growth.

In the ever-evolving financial ecosystem, understanding market trends and gauging the competitive landscape is imperative. Our analysis encompasses an in-depth examination of the microfinance sector, shedding light on how Muthoot Microfin positions itself amidst the competition. This knowledge empowers you to make strategic decisions aligned with market dynamics.

Long term Investors can hold Muthoot Microfin  stock after IPO listing. If you are short term traders then try to book Profit in Muthoot Microfin stock on IPO listing day.

Frequently Asked Questions (FAQs) on Muthoot Microfin IPO

What led to the slow start of Muthoot Microfin IPO on day 1?

The IPO had a slow start, reaching only 83% subscription on the first day, possibly due to initial investor hesitation.

How did Muthoot Microfin IPO recover from the slow start on day 1?

The IPO made a remarkable recovery on the second day, being fully subscribed within minutes of opening.

What financial metrics make Muthoot Microfin IPO reasonably priced?

The issue's reasonable pricing is reflected in its P/BV ratio and P/E ratio based on its NAV and post-IPO NAV.

Why is Muthoot Microfin's focus on rural microfinance significant?

The company's emphasis on rural microfinance showcases its commitment to financial inclusion and sustainable growth.

What makes Muthoot Microfin IPO an attractive option for investors?

The combination of robust financial performance, reasonable pricing, and controlled NPAs makes the IPO an appealing choice for investors seeking long-term rewards.


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