In this blog post, we will be discussing the major IPOs which are coming up in the next two months- November and December. Towards the end, we will be telling whether to apply to these IPOs. So, let’s directly dive into the topic.
⦁ FUSION MICRO FINANCE LIMITED
BUSINESS SEGMENT– Fusion Micro Finance Ltd. is involved in the FINANCIAL SECTOR. It provides formal credit to women in rural and peri-rural areas across India. They provide loans to women entrepreneurs in rural areas to fund businesses operating in the agriculture-allied and agriculture, manufacturing and production, trade and retail, and service sector.
Their business runs on a joint liability group-lending model, wherein a small number of women form a group (typically comprising five to seven members) and guarantee one another’s loans. The target audience of the company is women who have an annual family income of more than Rs. 1,60,000.
As of March 31st, 2021, they have a large distribution network of 725 branches and 6,351 permanent employees spread across 326 districts and 18 states and union territories in India and a customer base of about 17 crore borrowers.
FINANCIALS –
| Financial year | Gross Asset Under Management (AUM) | Total revenue | Profit after tax (PAT) |
| 2021(as at 31st March, 2021) | 46,378.39 | 8,730.88 | 439.44 |
| 2020(as at 31st March, 2021) | 36,065.24 | 7,303.11 | 696.1 |
| 2019(as at 31st March, 2021) | 26,413.91 | 4,970.53 | 506.69 |
| (Rs. in millions) |
IPO DETAILS –
| Issue size | 1103.99 crores |
| Price band | Rs. 350 – Rs. 368 |
| Min. order quantity | 40 shares |
| Face value | Rs. 10 |
| IPO open date | 2ndNovember, 2022 |
| IPO close date | 4th November 2022 |
| IPO open date | 2ndNovember, 2022 |
| IPO close date | 4th November 2022 |
OBJECTIVES OF RAISING FUNDS
– Increasing the capital base of the company
2) GLOBAL HEALTH LIMITED
BUSINESS SEGMENT– Global Health Ltd. is involved in the HEALTHCARE SECTOR. It is one of the largest private multi-specialty tertiary care providers operating in the North and East regions of India, with key specialties of cardiology and cardiac science, neurosciences, oncology, digestive and hepatobiliary sciences, orthopedics, liver transplant, and kidney and urology.
It has a network of four hospitals currently in operation (Gurugram, Indore, Ranchi, and Lucknow), a hospital that is under construction with an operational outpatient facility (Patna), and one hospital (Noida) planned for development under the brand name Medanta.
Dr. Naresh Trehan, a world-renowned cardiovascular and cardiothoracic surgeon founded the company in 2004. He has been awarded the Padma Bhushan, Padma Shri, and the BC Roy award, in recognition of his distinguished contribution to medicine.
FINANCIALS –
GLOBAL HEALTH LTD. FINANCIALS (as per DRHP)
| Financial year | Total Assets | Total revenue | Profit after tax (PAT) | Cash flow from operating activities |
| 2021(as at 31st March, 2021) | 26,941.05 | 14,781.58 | 288.05 | 2,417.71 |
| 2020(as at 31st March, 2021) | 26,662.87 | 15,442.67 | 363.27 | 1,750.67 |
| 2019(as at 31st March, 2021) | 24,300.05 | 15,059.57 | 513.03 | 1,655.53 |
| (Rs. in millions) |
IPO DETAILS–
| Issue size | Rs. 2,205.57 crores |
| Price band | Rs. 319 – Rs. 336 |
| Min. order quantity | 1 lot (44 shares) |
| Face value | Rs. 2 |
| IPO open date | 3rdNovember, 2022 |
| IPO close date | 7th November, 2022 |
OBJECTIVES OF RAISING FUNDS
– Repayment/prepayment of borrowings, in full or part, of the Subsidiaries, GHPPL and MHPL
– General corporate purposes
UNIPARTS INDIA LIMITED
- BUSINESS SEGMENT – Uniparts India Limited is involved in the AUTOMOTIVE COMPONENT SECTOR. It is a global manufacturer of engineered systems. It is one of the leading suppliers of systems and components for the off-highway market in agriculture and construction, forestry and mining, and aftermarket sectors.
The company has six manufacturing facilities and four warehousing locations across the US, Europe, and India. It has a presence across 25 countries.
Its product portfolio includes core product verticals of 3-point linkage systems (3PL), precision machined parts (PMP), and adjacent product verticals of power take-off fabrications and hydraulic cylinders or components.
FINANCIALS –
UNIPARTS INDIA LTD. FINANCIALS (as per DRHP)
| Financial year | Total Assets | Total revenue | Profit after tax (PAT) |
| 2021 (as at 31st Dec, 2021) | 10,072.53 | 8,841.89 | 1,223.36 |
| 2021 (as of 31st March, 2021) | 8,932.70 | 9,476.89 | 923.86 |
| 2020 (as of 31st March, 2021) | 8,987.47 | 9,388.38 | 626.42 |
| 2019 (as of 31st March, 2021) | 9,584.37 | 10,624.78 | 695.97 |
| (Rs. in millions) |
IPO DETAILS –
| Issue size | Rs. 15,73,19,420 crores |
| Price band | N.A. |
| Min. order quantity | N.A. |
| Face value | Rs. 10 |
| IPO open date | N.A. |
| IPO close date | N.A. |
FIVE STAR BUSINESS FINANCE LIMITED
BUSINESS SEGMENT– Five Star Business Finance Ltd. is involved in the NON-BANKING FINANCIAL COMPANY sector. It provides secured business loans to micro-entrepreneurs and self-employed individuals. As of September 30th2021, the company has a network of 268 branches in approximately 126 districts, 8 states, and 1 union territory, with Tamil Nadu, Andhra Pradesh, Telangana, and Karnataka being the key states. It has 4,306 employees.
The company has provided loans to more than 1,85,000 customers in total. They had an active loan base of 1,76,467 as of March 31st, 2021.
FINANCIALS –
| FIVE STAR BUSINESS FINANCE LTD. FINANCIALS (as per DRHP) | |||
| Financial year | Total Assets | Total revenue | Profit after tax (PAT) |
| 2021(as at 31st March, 2021) | 5,793.61 | 1,051.26 | 358.99 |
| 2020(as at 31st March, 2020) | 4,353.15 | 787.35 | 261.95 |
| 2019(as at 31st March, 2019) | 2,361.17 | 408.99 | 156.41 |
| (Rs. in crores) |
IPO DETAILS–
| Issue size | Rs. 2,751.95 crores |
| Price band | N.A. |
| Min. order quantity | N.A. |
| Face value | N.A. |
| IPO open date | N.A. |
| IPO close date | N.A. |
Now, the most important question is – Should you apply for the IPO?
The statement which I am going to make may disappoint you a lot – It is advisable not to apply for any IPO if you’re thinking that if there will be no listing gain, I’ll hold it as an investment. Confused? Let’s discuss this.
• Odds against your favor – Suppose person A applies for an IPO that is oversubscribed 100 times. The probability of him getting the IPO is 1 in 100 (only 1%). It is more likely that you will not get the IPO. Now, let’s suppose person B applies for an IPO that is undersubscribed. It is likely that he will get the IPO on a listing day. Also, after he gets it, he would be in a situation of No profit No loss or even a Huge Loss. Hence in both cases, the odds are not in your favor.
• Extremely overpriced – Also, a logical perception is that whenever the IPOs are launched, they are extremely overpriced. The seller would always demand a premium price in the markets and we as buyers give it to the sellers.
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