Manappuram Finance shares at 52-week high as subsidiary likely to launch IPO

Kerala-based gold loan provider, Manappuram Finance's shares hit 52-week high on Wednesday on report that its subsidiary, Asirvad Microfinance, is reportedly working on an initial public offering (IPO) to raise approximately Rs 1,500 crore The firm has engaged three investment banks, including JM Financial, Nomura, and Kotak Mahindra Capital for the IPO, reported Moneycontrol.

The decision to go public comes after the successful acquisition of a significant majority stake in the Chennai-based micro-finance firm by Manappuram Finance in February 2015, as part of its diversification strategy. On Wednesday, Manappuram Finance's shares closed nearly 4% higher at Rs 135.10, with the 52-week high being 135.95.
The IPO is expected to be a pure primary issuance of shares, and Asirvad Microfinance is keen to capitalise on the favourable regulatory environment for the micro-finance sector and the positive outlook from analysts. The recent impressive market debut of Uttkarsh Small Finance Bank has further bolstered their sentiment, driving them to file the draft red herring prospectus (DRHP) with SEBI by September.

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