Muthoot Finance to raise Rs 1,400 cr via IPO

PTI New Delhi | Updated on March 10, 2011 Published on March 10, 2011

Gold financing company Muthoot Finance will raise up to Rs 1,400 crore through an initial share sale offer, which is expected to begin in the last week of this month.

The Securities and Exchange Board of India 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 13.85 per cent 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 Rs 1,200-1,400 crore.

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

The 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 the future capital requirements, 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.

The 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.

Published on March 10, 2011
This article is closed for comments.
Please Email the Editor