India Shelter Finance Corporation Limited – About the Company
India Shelter Finance Corporation Limited incorporated in 1998 as Satyaprakash Housing Finance India Limited is a retail-focused affordable housing finance company with an extensive distribution network of 203 branches across 15 states, including Rajasthan, Maharashtra, Madhya Pradesh, Karnataka, and Gujarat. India Shelter Finance offers small and mid-ticket home loans, typically in the size of Rs. 5 lakhs to Rs. 50 lakhs. It provides home loans for construction, purchase, extension and also for renovation. In addition, it also offers loan against property (LAP). It largely caters to the unbanked and under-banked sections of society and has so far disbursed loans worth Rs. 5,500 crore.
The home loans offered by India Shelter Finance Corporation Ltd are for a maximum period of 20 years with interest rate varying between 10.5% and 20% depending on the risk perception of the client. It also has a full-fledged collection team of more than 300 officials working to keep collections on target and the non-performing assets under control. More than 70% of the borrowers at India Shelter Finance Corporation Ltd are first home loan borrowers. Its portfolio is largely retail focused and hence the yields are also relatively higher. Its focus is largely on the Tier-2 and Tier-3 cities and caters to a growing customer base through a mix of physical and digital presence. Its original model is largely in-house.
The company has obtained long-term funding from a diversified lender base comprising over 37 counterparties, including 24 scheduled commercial banks. As of September 30, 2023, it has a healthy credit rating of ICRA A+ (stable) from ICRA Limited and CARE A+ (Positive) from CARE Limited.
India Shelter Finance Corporation Limited IPO Objectives
India Shelter Finance Corporation is a Rs. 1200 cr IPO out of which, Rs. 800 is fresh issue and the rest Rs. 400 is offer-for-sale (OFS) of shares by the promoters. This means that 33% of the IPO issue will go to the shareholders who are selling their stakes.
Apart from providing the opportunity to promoters to monetize their stakes, the main objective of the India Shelter Finance Corporation IPO is to meet future capital requirements towards onward lending and general corporate purposes. Out of the Rs. 800 cr fresh issue, Rs. 640 cr will be used for future capital requirements towards onward lending and the rest Rs. 160 cr will be used for General corporate purposes.
India Shelter Finance Corporation IPO Details:
| IPO Open Date | 13-Dec-23 |
| IPO Close Date | 15-Dec-23 |
| Basis of Allotment | 18-Dec-23 |
| Listing Date | 20-Dec-23 |
| Face Value | Rs 10 per share |
| Price | Rs. 469 to Rs. 493 per share |
| Lot Size | 30 Shares |
| Issue Size | 24,340,771 shares |
| (aggregating up to Rs 1,200.00 crore) | |
| Fresh Issue | 16,227,181 shares |
| (aggregating up to Rs. 800.00 Cr) | |
| Offer For Sale | 8,113,590 shares of Rs. 5 |
| (aggregating up to Rs. 400.00 Cr | |
| Issue Type | Book Built Issue IPO |
| Listing At | BSE & NSE |
| QIB Shares Offered | Not more than 50.00% of the Net offer |
| NII (HNI) Shares Offered | Not more than 15% of the Net Issue |
| Retail Shares Offered | Not less than 35.00% of the Offer |
India Shelter Finance Corporation Limited IPO Issue Price & Size
The India Shelter Finance Corporation IPO Issue Price will be in the range of Rs. 469 to Rs. 493 per share. Investors can bid in the IPO between these lower and higher price bands. The total issue size of India Shelter Finance Corporation Limited IPO is Rs 1,200 crore out of which Rs 800 will OFS and Rs 300 crore will be fresh issue of shares.
India Shelter Finance Corporation IPO Launch Date
India Shelter Finance Corporation IPO will be open on 13 Dec 2023 and the last day of the IPO is 15 Dec 2023. The launch date is officially declared and investors who are looking to bid or invest in the India Shelter Finance Corporation IPO can bid between the 13 and 15 Dec 2023.
India Shelter Finance Corporation Financial Statements:
| PARTICULARS | Mar-23 | Mar-22 | Mar-21 | Mar-20 | Mar-19 |
| Net Sales | 583.91 | 447.98 | 316.71 | 229.08 | 172.09 |
| Total Expenditure | 182.65 | 134.83 | 97.42 | 84.35 | 83.04 |
| Operating Profit | 401.27 | 313.14 | 219.29 | 144.73 | 89.05 |
| Other Income | 21.71 | 11.83 | 6.09 | 0.83 | 0 |
| Interest | 213.31 | 151.53 | 107.33 | 75.86 | 49.29 |
| Depreciation | 8.2 | 6.54 | 5.1 | 5.87 | 2.1 |
| Exceptional Items | 0 | 0 | 0 | 0 | 0 |
| Profit Before Tax | 201.47 | 166.9 | 112.96 | 63.84 | 37.66 |
| Provision for Tax | 46.49 | 38.45 | 25.57 | 16.93 | 9.73 |
| Net Profit | 154.98 | 128.45 | 87.39 | 46.91 | 27.93 |
| Adjusted EPS (Rs.) | 3.54 | 2.94 | 2.03 | 1.1 | 0.66 |
India Shelter Finance Corporation key ratios
| Particulars (Rs. in Cr) | FY23 | FY22 | FY21 |
| PAT Margins | 25.62% | 27.94% | 27.07% |
| Total Equity | 1,240.53 | 1,076.13 | 937.27 |
| Total Assets | 4,295.59 | 3,221.22 | 2,462.64 |
| Return on Equity | 12.52% | 11.94% | 9.32% |
| Return on Assets | 3.62% | 3.99% | 3.55% |
| Asset Turnover Ratio | 0.14 | 0.14 | 0.13 |
| AUM based on the Income Groups | (in Millions) | ||
| Income Group | FY 23 | FY 22 | FY 21 |
| Economically weaker section | 9,581.30 | 7,344.72 | 6,678.54 |
| Low-income group | 21,080.44 | 13,767.92 | 9,206.63 |
| Middle-income group | 11,894.90 | 8,532.98 | 5,192.73 |
| High-income group | 1,037.66 | 1,087.31 | 907.38 |
| Total | 43,594.31 | 30,732.93 | 21,985.27 |
India Shelter Finance Corporation Financial Performance
India Shelter Finance Corp Ltd has consistently shown grown in its financials, between FY21 and FY23, AUM grew by 40.8% annually to Rs. 4,359.4 crore, with revenue from operations increasing by 35.9% to Rs. 584.5 crore and net profit rising by 33.3% to Rs. 155.3 crore. The gross non-performing asset (GNPA) ratio fell to 1.1% in FY23 from 2.1% in the previous year, and the return on asset (RoA) was 4.1% in FY23. The company’s profitability has shown substantial improvement, with a profit after tax of Rs. 1,553.42 million in 2023 compared to Rs. 873.89 million in 2021, reflecting increased operational efficiency. The company demands a price-book (P/B) of up to 2.4 considering the equity after the IPO, compared to larger home finance peers like Aavas Financiers, Aptus Value Housing Finance, and Home First Finance Company.
Why Invest in India Shelter Finance Corporation IPO?
Investing in any company launching IPO you should consider various factors. From the company's fundamentals to management of the company and financial performance there are various things you should consider while investing in any company listed or going to list in the stock market? Analyzing these factors will help you to know the strength of the company with the growth potential and future prospects of the management and the company itself.
Strengths
- Among the fastest-growing assets under management among Housing Finance Companies in India, high yields and a granular, retail-focused portfolio.
- Boasts a comprehensive and diversified Physical Distribution Network, with a strong presence in Tier II and Tier III cities.
- In-house Origination Model ensures efficient and seamless operations across various key functions.
- Technology and analytics-driven company with a scalable operating model.
- Robust underwriting, collection, and risk management systems.
- The company possesses a diversified financing profile with a demonstrated track record of lowering financing costs.
- Experienced management team supported by qualified and experienced personnel.
Risks
- The business requires a substantial amount of capital for operations, and any disruption in sources of financing could harm the business, financial condition, and results of operations.
- Risk of non-payment or default by customers, may adversely affect the business, companies financial condition, and the results of operations.
- 4% of assets under management for the 1HFY23 in the FY23 were contributed mainly by three states, and any adverse developments in these states could hurt the business, its financial condition, and the results of operations.
- Deterioration of the loan book and effective monitoring and collection methods are not implemented, it may adversely affect the results of operations.
- Non-compliance with the National Housing Bank and Reserve Bank of India's periodic inspections may result in fines and penalties.
India Shelter Finance Corporation Promoters and Management
Anil Mehta, WestBridge Crossover Fund, LLC and Aravali Investment Holdings are the key Promoters of the Company.
| Pre-issue Promoters Holding | 56.75% |
| Post-issue Promoters Holding | 48.17% |
India Shelter Finance Corporation IPO Grey Market Premium (GMP)
The Grey Market Premium (GMP) of India Shelter Finance Corporation IPO is trailing around Rs 140 - 150, and it will keep fluctuating till the date of listing of shares. The GMP is the premium over the issue price that is disclosed in the IPO for bidding. The GMP is defined as the supply of shares and demand in the grey market showing the sentiments of the investors.
Also Read: What is Grey Market Premium in IPO: How is GMP Calculated &Reliable
However, the GMP is not a reliable or stable criterion for knowing the listing price of any share as it can keep changing as per the demand for the shares and sentiments in the secondary market. However, you can use the GMP to guess the expected listing price.
How to Apply for India Shelter Finance Corporation IPO?
To apply not only to India Shelter Finance Corporation IPO but IPO of any other company, you must have a trading account and demat account. If you don't have one, just apply here to open both these accounts with Moneysukh and follow the steps given below.
Also Read: How to Open Demat Account: Benefits and Documents Required
Steps to Apply for India Shelter Finance Corporation IPO:
Step 1: You can apply for the India Shelter Finance Corporation IPO once it is open for online bidding.
Step 2: Now navigate to trade.moneysukh.com and log in with your User ID & password.
Step 3: Here you need to open the IPO section and select the India Shelter Finance Corporation IPO.
Step 4: Now you have to fill in the required details like price, quantity, and so on.
Note: At the time of applying in any IPO, bid at the cutoff price before submitting your application.
Step 5: Now make the payment online as per your selected lot size and submit successfully.
How to Check India Shelter Finance Corporation IPO Allotment Status?
The allotment status will show if you have been allotted any shares in the IPO. If you have applied and now want to check India Shelter Finance Corporation IPO allotment status you can use the various website with all your IPO application and PAN card details.
Also Read: How to check IPO allotment status on NSE, BSE through Moneysukh
Although, you can check the allotment status only when online bidding is closed and allotment is done. The allotment procedure is organized as per the subscription of bidding, if the IPO is oversubscribed, there is less chance of getting the allotments of shares.
Also Read: How to Increase the Chances of IPO Allotment
Depending on the Retail and HNI category IPO application and subscription, investors get the allotment of shares. If you have not been allotted any shares in the IPO, your money will be refunded back into your bank account or the fund will be unblocked if applied through ASBA. And luckily if you have been allocated any lot, then the shares will be transferred into your demat account before the day of listing that you can sell in the secondary markets.
Also Read: Benefits of Investing in the Stock Market: Advantages of Share Market
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