Manba Finance Limited IPO: Key Dates, Strengths, Risks & How to Apply

After Northern Arc Capital's successful listing, another player in India's non-banking financial sector, Manba Finance Limited, is set to launch its Initial Public Offering (IPO) on September 23, 2024. The company, known for offering vehicle loans and financial products across various customer segments, aims to further strengthen its capital base with this public issue.

The IPO will start on September 23, 2024, and end on September 25, 2024. Manba Finance has established itself as a reliable financial institution providing specialised vehicle and personal loans. 

Let's look at the key details of Manba Finance IPO.

Manba Finance IPO: Key Details

Manba Finance's upcoming IPO provides investors with an opportunity to invest in a well-established NBFC focused on the growing demand for vehicle loans in India. The IPO will consist of 12,570,000 shares, with a total issue size of up to ₹150.84 crore.

Here are the important details:

Business Overview: About Manba Finance

Founded in 1998, Manba Finance Limited is a well-established Non-Banking Financial Company (NBFC) that specialises in vehicle financing and personal loans. It caters to a wide customer base, including salaried individuals and self-employed professionals.

The company's core business revolves around financing for:

• New Two-Wheelers (2Ws) and Electric Two-Wheelers (EV2Ws)
• Three-Wheelers (3Ws) and Electric Three-Wheelers (EV3Ws)
• Used Cars, small business loans, and personal loans.

Manba Finance offers loans of up to 85% of a vehicle's on-road price, making it an attractive option for customers across India, particularly in underpenetrated markets.

Major Milestones and Achievements

Manba Finance has witnessed significant growth over the years:

• 1998: Received NBFC registration from the Reserve Bank of India (RBI).
• 2013: Crossed an Asset Under Management (AUM) of ₹5,000 lakhs.
• 2024: Reached an AUM of ₹90,000 lakhs.

Objectives of the IPO

The primary goal of this IPO is to strengthen Manba Finance's capital base to support its business expansion and further growth in its lending activities.

Strengths of Manba Finance

1. Geographical Expansion: The ability to expand into underpenetrated geographies offers a great growth potential.
2. Diversified Borrowing Access: Manba Finance has access to cost-effective, long-term borrowing that allows it to maintain competitive interest rates.
3. Technology-Driven: The company boasts a technology-backed operating model that ensures a quick turnaround time (TAT) of just 5.3 days for loan approvals.

Risks Associated with Manba Finance IPO

1. Reliance on Dealer Relationships: 89.13% of the company's new vehicle loan business in FY24 was sourced from dealer relationships. Any weakening in these partnerships could hurt the company's loan generation.
2. Concentration in Vehicle Loans: New vehicle loans make up 97.90% of the company's AUM, highlighting a lack of diversification in loan products.
3. Credit Rating Downgrades: A downgrade in credit ratings could increase borrowing costs and adversely impact the company's overall financial health.

Financial Performance

Manba Finance's financial results show strong growth in recent years. Here are the key highlights:

The company's revenue and Profit After Tax (PAT) have grown significantly, reflecting its robust financial performance and strategic focus.

How to Apply for Manba Finance IPO?

To apply for the Manba Finance Limited IPO via INDmoney, follow these steps:

• Download the INDmoney app and create a free account by completing the KYC process.
• Click on the INDstocks tab, followed by IPOs.
• In the 'Explore IPOs' section, find 'Live IPOs.'
• Click 'Apply' to view the key details of the IPO.
• Choose the number of lots you wish to apply for and continue with the application.
• Place your order via UPI. The funds for your IPO application will be held in your bank account until the shares are allocated.

Conclusion

The upcoming IPO of Manba Finance Limited provides investors with a chance to participate in a growing financial institution that has demonstrated resilience and growth in the Indian financial sector. The company's strong dealer relationships, technology-driven loan processing, and focus on underpenetrated markets make it an attractive investment option. However, potential investors should also consider the risks, particularly its dependency on vehicle loans and dealer partnerships.

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