Fusion Micro Finance
Mainboard₹1,104 Cr issue
-2.04%
Listing gain over issue price
Issue size
₹1,104 Cr
1 lot at cut-off
₹14,720
Lot size
40shares
Open
02 Nov 2022
Close
04 Nov 2022
Allotment
10 Nov 2022
Listing
15 Nov 2022
Listing performance
Issue price
₹368
Listed at
₹360.50
Listing-day close
₹324.90
Latest price
₹139.48
Close on 23 Oct 2026
Listing gain
-2.04%
Return since issue
-62.10%
Scheduled dates
Tentative timetable — a past date is not confirmation the step completed
Issue details
- IPO date
- 02 Nov 2022 – 04 Nov 2022
- Listing date
- 15 Nov 2022
- Face value
- ₹10 per share
- Issue price
- ₹368 per share
- Lot size
- 40 shares
- Total issue size
- ₹1,104 Cr
- Market cap at offer price
- ₹3,703 Cr
- Promoter holding
- 85.57% → 68.18% pre-issue → post-issue
- ISIN
- INE139R01012
- Registrar
- MUFG Intime India Pvt.Ltd.
- Lead managers
- ICICI Securities Ltd.
- Registered office
- H-1, C Block, Community Centre, Naraina Vihar, New Delhi
Reservation and application size
How the issue is split between investor categories, and what each may bid
| Investor category | Shares | % of net | % of total |
|---|---|---|---|
| Anchor investor · within QIB | 89,99,943 | — | — |
| Market maker | 0 | — | — |
Application size
Minimum 40 shares per lot, in multiples, at ₹368
| Application | Lots | Shares | Amount |
|---|---|---|---|
| Retail (min) | 1 | 40 | ₹14,720 |
| Retail (max) | 13 | 520 | ₹1,91,360 |
| S-HNI (min) | 14 | 560 | ₹2,06,080 |
| S-HNI (max) | 67 | 2,680 | ₹9,86,240 |
| B-HNI (min) | 68 | 2,720 | ₹10,00,960 |
Category limits
| Category | Bid size | Cut-off |
|---|---|---|
| Retail (RII) | Up to ₹2 lakh | Yes |
| Small HNI (sNII) | ₹2 lakh – ₹10 lakh | No |
| Big HNI (bNII) | Above ₹10 lakh | No |
| Employee | Up to ₹5 lakh | Yes |
Bidding at cut-off means accepting the final issue price without naming one. Only retail and employee applicants may do so.
Anchor investors
Institutional allocation placed a day before the issue opens, carved out of the QIB portion and locked in after listing.
Shares allocated
89,99,943
Anchor portion
₹331 Cr
at ₹368 per share
Valuation and performance
Valuation at offer price
₹368 per share
| Metric | Pre-issue | Post-issue |
|---|---|---|
| EPS (₹) | 2.67 | — |
| P/E (×) | 137.83 | — |
| Market cap | — | ₹3,703 Cr |
Key performance indicators
Latest reported period
- Return on net worth
- 1.63%
- Debt / equity
- 1.20
- NAV per share
- ₹161.67
Single period as reported. Year-on-year movement is in the financials table below, where every period is published.
About Fusion Micro Finance
Fusion Micro Finance Limited is an NBFC-Microfinance Institution providing financial services to underserved women across India. Originally incorporated as 'Ambience Fincap Private Limited' on September 5, 1994, it received an RBI certificate of registration as a non-deposit accepting non-banking financial company in 2003. The company was granted NBFC-MFI status by the RBI effective January 28, 2014. As of June 30, 2022, the company had 2.90 million active borrowers served by 966 branches across 377 districts in 19 states and union territories, with total AUM of ₹73,890.23 million. The company provides unsecured microfinance loans primarily to women in rural areas with annual household income up to ₹300,000, utilizing a joint liability group mechanism for loan guarantees. Interest income represents approximately 91% of the company's total income.
Company Analysis
from RHPFusion Micro Finance Limited is a microfinance institution providing unsecured loans to underserved women in rural India to facilitate their access to greater economic opportunities.
Fusion Micro Finance Limited is an NBFC-Microfinance Institution providing financial services to underserved women across India. Originally incorporated as 'Ambience Fincap Private Limited' on September 5, 1994, it received an RBI certificate of registration as a non-deposit accepting non-banking financial company in 2003. The company was granted NBFC-MFI status by the RBI effective January 28, 2014. As of June 30, 2022, the company had 2.90 million active borrowers served by 966 branches across 377 districts in 19 states and union territories, with total AUM of ₹73,890.23 million. The company provides unsecured microfinance loans primarily to women in rural areas with annual household income up to ₹300,000, utilizing a joint liability group mechanism for loan guarantees. Interest income represents approximately 91% of the company's total income.
MicrofinanceNon-Banking Financial ServicesFinancial Inclusion
Objects of the Issue
- Augment the capital base of our Company ₹6,000.00 million p.21
- Augmenting the company's capital base ₹5,693.65 million (Net Proceeds) p.103
- Benefits of listing including enhancement of brand name and creation of public market for Equity Shares p.103
- Augment the capital base of our Company p.104
- Not disclosed in this part of the document
Issue Structure
- Total Issue
- 29,999,813 Equity Shares* aggregating to ₹11,039.93 million
- Fresh Issue
- 16,304,347 Equity Shares* aggregating to ₹6,000.00 million
- Offer for Sale
- 13,695,466 Equity Shares* aggregating to ₹5,039.93 million by the Selling Shareholders
- Price Band
- ₹350 per Equity Share (Floor Price) to ₹368 per Equity Share (Cap Price)
- Lot Size
- 40 Equity Shares and in multiples of 40 Equity Shares thereafter
- Face Value
- ₹10 per Equity Share
Business Model
The company generates revenue primarily through interest income on unsecured microfinance loans provided to women in low-income groups. For the financial year 2022, interest income amounted to ₹10,643.19 million, representing 88.59% of total income. The company charges annual effective interest rates of 22.65% for first loan cycle and 22.25% for subsequent loan cycles. Borrowers form joint liability groups of typically 5-7 members providing joint and several guarantees. The company also earns fee income from loan processing and other operations.
Business Segments
Provision of unsecured microfinance loans to underserved women in rural India through a joint liability group mechanism. Loans are provided to women belonging to low-income groups with annual household income up to ₹300,000.
Provides microfinance loans to low-income individuals primarily in North India. The company finances loans for purchase of products such as mobile phones, bicycles, kitchen appliances and other items.
Provides microfinance loans to self-employed individuals, women entrepreneurs, and Micro, Small and Medium Enterprises (MSMEs) primarily in rural and semi-urban areas
Core loan product providing capital for small businesses operated by women in rural areas, covering agriculture-allied and agriculture, manufacturing and production, trade and retail, and services sectors.
Includes activities such as dairy production, animal husbandry, poultry farming and crop cultivation.
Includes activities such as the manufacturing and/or production of bags, furniture, mats and handicrafts, as well as bread and other baked goods.
Includes activities such as the sale of clothes, groceries and general merchandise.
Includes activities such as the provision of clothes tailoring and stitching services as well as small food establishments.
Granted to existing customers to manage interim working capital requirements for their existing business.
Leverage existing customer base to provide loans for livelihood and productivity enhancing purposes, financing purchase of mobile phones, bicycles, kitchen appliances and other items.
Offered to eligible enterprises that are manufacturers, traders or service providers with investment limit less than ₹1,500,000.
Granted to existing customers to fund urgent financial requirements arising out of unforeseen events such as health emergencies, natural disasters and family bereavements.
Providing collateral-free loans to poor women organized as Joint Liability Groups (JLGs)
Providing loans to MSME enterprises
Distributing other financial products and services to members including loans for productivity-enhancing products such as mobile handsets and bicycles
Loans provided under joint liability arrangement
Micro, Small and Medium Enterprise loans
Income-generating loans to women entrepreneurs in rural areas under joint liability group model
Loans offered to eligible enterprises for livelihood and productivity enhancing purposes
Top-up loans for interim working capital requirements and emergency loans for unforeseen financial needs
Loans provided to customers engaged in agriculture and agriculture-allied activities
Loans provided to customers engaged in manufacturing and production activities
Loans provided to customers engaged in trade and retail activities
Loans provided to customers engaged in services activities
Loans provided to micro, small and medium enterprises
SWOT Analysis
Strengths
- • High employee benefits expenses indicate strong workforce investment(p.45)
- • Significant AUM growth demonstrating business expansion(p.45)
- • Strong brand recognition with trademark ownership(p.47)
- • Second largest NBFC-MFI with strong growth trajectory(p.151)
- • Highest rural client concentration among top peers(p.155)
- • Superior operational efficiency with highest clients per employee(p.153)
- • Significant cost-to-income ratio improvement demonstrating operational leverage(p.160)
- • Rapid GLP growth ranking 3rd fastest among top NBFC-MFIs(p.151)
- • Broad geographic diversification with presence in 18 states and 368 districts(p.155)
- • Low GLP per customer indicating better risk diversification(p.157)
- • Extensive pan-India presence with significant footprint(p.172)
- • Proven execution capabilities with strong rural focus and low cost-to-income ratio(p.177)
- • Diversified funding sources and strong credit ratings(p.178)
- • Lowest asset quality risk among peer MFIs in North India(p.179)
- • Advanced technology infrastructure enabling digitalization(p.180)
- • Experienced management team with significant leadership tenure(p.180)
- • Strong support from marquee global investors(p.180)
- • Superior customer growth rate outperforming industry(p.169)
- • Established Board with independent director expertise in finance and inclusive finance sectors(p.220)
- • CEO with extensive microfinance and inclusive finance experience(p.220)
- • Strong financial position with growing assets(p.254)
- • Experienced management team with specialized roles in risk, operations, and technology(p.237)
- • Growing loan portfolio with strong net disbursements(p.278)
- • Diversified funding sources including debt securities, bank borrowings, and subordinated liabilities(p.288)
- • Concentrated promoter ownership providing stable long-term vision(p.295)
- • Large diversified lender base reducing funding dependence(p.333)
- • Strong credit ratings improvement trajectory(p.333)
- • Declining cost of borrowings trend(p.333)
- • High digital adoption and cashless disbursement capabilities(p.334)
- • Strong corporate governance and client protection standards(p.334)
- • Fourth fastest loan portfolio growth among top 10 MFIs(p.332)
- • Revenue growth from expanded loan portfolio(p.348)
- • Diversified geographic footprint reducing concentration risk(p.365)
- • Strong collections efficiency post-COVID recovery(p.348)
- • Significant branch network expansion(p.364)
- • Growing employee base supporting business expansion(p.350)
Weaknesses
- • High employee attrition affecting operational continuity(p.47)
- • Inflexible cost structure with limited ability to adjust to volume declines(p.45)
- • Dependence on relationship managers for customer relationships(p.47)
- • Exposure to securitization and receivable assignment risks(p.45)
- • Outstanding litigation proceedings creating management distraction(p.48)
- • Missing secretarial records creating regulatory compliance risk(p.49)
- • Promoter personal guarantees creating contingent liability exposure(p.46)
- • RBI inspection observations requiring corrective actions(p.46)
- • Conflicts of interest with directors holding competing interests(p.48)
- • All properties on leasehold basis with lease renewal risks(p.50)
- • Insurance claims rejection history(p.51)
- • Significantly deteriorated profitability with lowest RoE and RoA among peers(p.163)
- • Asset quality deterioration with elevated GNPA and NNPA ratios(p.166)
- • Below-average capital adequacy ratio among peers(p.164)
- • High credit costs impacting profitability(p.159)
- • Elevated gross NPA ratio relative to prior year performance(p.173)
- • Declining capital adequacy ratios despite strong asset growth(p.178)
- • High employee attrition rate impacting talent retention(p.200)
- • Increased debt-to-equity ratio indicating higher leverage(p.178)
- • Reliance on founder-promoter guarantees for significant debt(p.217)
- • High dependence on borrowed funds for financing loan portfolio(p.254)
- • Significant impairment on financial instruments(p.255)
- • No dividend payments made despite profitability(p.248)
- • High concentration of promoter ownership limiting minority shareholder influence(p.239)
- • High impairment loss allowance indicating asset quality concerns(p.278)
- • Significant Stage III (credit-impaired) loans in portfolio(p.278)
- • High leverage with debt-to-equity ratio driven by aggressive borrowing(p.288)
- • Heavy dependence on unsecured lending with minimal collateral coverage(p.278)
- • Elevated gross NPA ratio post-COVID-19(p.340)
- • Significant increase in impairment loss allowance(p.340)
- • Declining collection efficiency rates(p.340)
- • High leverage with rising debt to equity ratio(p.328)
- • Declining profitability despite AUM growth(p.335)
- • Significant impairment on loan portfolio at elevated levels(p.349)
- • High debt-to-equity ratio indicating high financial leverage(p.358)
- • Declining profitability despite revenue growth(p.350)
- • High operating expense burden(p.359)
- • Elevated gross NPA levels(p.359)
Opportunities
- • Expansion through branch network and rural market penetration(p.53)
- • Growth in microfinance industry as indicated by regulatory support(p.53)
- • Public market access and brand enhancement through listing(p.103)
- • Capital base augmentation for business growth(p.103)
- • Underpenetrated rural markets with significant growth potential(p.121)
- • Industry GLP projected to grow at 18-20% CAGR through FY2025(p.130)
- • NBFC-MFIs expected to gain market share to 38% by FY2025(p.132)
- • New RBI regulations removing interest rate caps supporting profitability(p.140)
- • Large untapped markets in underpenetrated states with low credit availability(p.127)
- • Expansion scope in existing districts with low branch penetration(p.158)
- • Ticket size expansion potential as penetration increases(p.134)
- • Expansion into underpenetrated states with significant growth potential(p.181)
- • Deepening customer penetration through product cross-selling(p.182)
- • Technology-driven operational efficiency and cost optimization(p.182)
- • Further diversification of funding sources to reduce borrowing costs(p.182)
- • Strong growth in North India microfinance market(p.168)
- • Expansion into MSME lending segment beyond core microfinance(p.258)
- • Leverage distribution channel for additional financial products and services(p.258)
- • Growth in lending portfolio with strong recent expansion(p.254)
- • Access to debt capital markets and institutional funding(p.254)
- • Expansion of microfinance market in underserved rural areas of India(p.278)
- • Growing MSME lending segment with minimal exposure currently(p.278)
- • Planned IPO to strengthen capital base and support growth(p.284)
- • Significant low-penetration rural credit opportunity in India(p.335)
- • Microfinance sector growth forecast(p.340)
- • Geographic expansion in underpenetrated rural areas(p.333)
- • Digital transformation and technology investments(p.334)
- • Potential for cross-selling and product expansion(p.332)
- • Expansion into new geographic markets(p.364)
- • Growing proportion of repeat customers indicating customer loyalty(p.364)
- • Significant proportion of first-time formal borrowers indicating greenfield potential(p.364)
- • Growth in market support income from advertising and distribution arrangements(p.349)
- • Cross-selling and fee income generation opportunities(p.349)
Threats
- • Economic slowdown and regional recession impact on disbursements(p.53)
- • Business seasonality affecting quarterly performance(p.50)
- • Regulatory changes affecting NBFC operations and securitization(p.45)
- • State-level regulatory restrictions on NBFC-MFI business(p.53)
- • Exchange rate fluctuations affecting foreign currency operations(p.59)
- • Interest rate changes and credit availability constraints(p.52)
- • Demonetization and policy changes impact on disbursements(p.54)
- • COVID-19 pandemic moratorium on loan repayments(p.54)
- • Tax law changes and GST implementation risks(p.52)
- • Natural disasters and climate change impacts in operating regions(p.52)
- • Competition law enforcement risks(p.57)
- • Dependence on third-party service providers(p.49)
- • Labor disputes and worker strikes affecting operations(p.46)
- • Inadequate insurance coverage for operational risks(p.50)
- • Elevated asset quality risks with PAR>90 increasing to 16% in Q1FY23(p.145)
- • Slippages from restructured book posing ongoing risks(p.149)
- • Cost of funds expected to increase with RBI rate hikes(p.119)
- • Rising inflation reducing rural demand and purchasing power(p.121)
- • Political intervention risks as evidenced by Assam experience(p.140)
- • Vulnerability of rural incomes to external shocks(p.136)
- • Increased competition from banks and SFBs in microfinance segment(p.132)
- • Increased competition from diverse lending institutions including banks(p.199)
- • Regulatory framework changes including income and repayment limits(p.195)
- • Macroeconomic disruptions from COVID-19 pandemic(p.183)
- • Geographic concentration risks in North India operations(p.176)
- • Political and regulatory risks affecting microfinance operations(p.194)
- • Credit risk and loan portfolio impairment exposure(p.266)
- • Macroeconomic sensitivity and pandemic-related uncertainties(p.251)
- • Reliance on external capital for growth funding(p.248)
- • Foreign exchange exposure on external borrowings(p.269)
- • Regulatory risks including potential changes to NBFC lending guidelines and Reserve Bank oversight(p.301)
- • Interest rate risk on external commercial borrowing with variable rate exposure(p.284)
- • Foreign exchange risk from External Commercial Borrowings in EURO(p.284)
- • Concentration risk with joint liability loans forming bulk of portfolio(p.278)
- • COVID-19 pandemic impact on collections and customer repayments(p.340)
- • Regulatory changes affecting microfinance industry operations(p.339)
- • RBI's new microfinance lending restrictions(p.339)
- • Interest rate volatility risk(p.336)
- • Dependence on funding market access and cost of funds(p.336)
- • Industry competition intensification(p.356)
- • Business seasonality affecting cash flows(p.356)
- • Dependence on continued access to funding and cost sensitivity(p.353)
- • Regulatory changes affecting microfinance operations(p.356)
- • Geographic concentration risk in portfolio(p.365)
Promoters
| Name | Role | Pre-Issue | Post-Issue |
|---|---|---|---|
| Devesh Sachdev | Promoter | 5,552,414 equity shares (6.58%) | 4,902,414 equity shares (4.87%) |
| Creation Investments Fusion, LLC | Promoter | 15,321,043 equity shares (18.17%) | 13,921,043 equity shares (13.83%) |
| Creation Investments Fusion II, LLC | Promoter | 9,954,529 equity shares (11.80%) | 9,954,529 equity shares (9.89%) |
| Honey Rose Investment Ltd | Promoter | 41,022,730 equity shares (48.65%) | 39,622,730 equity shares (39.37%) |
| Honey Rose Investment Ltd | Promoter | 48.65% | 39.37% |
| Creation Investments Fusion, LLC | Promoter | 18.17% | 13.83% |
| Creation Investments Fusion II, LLC | Promoter | 11.80% | 9.89% |
| Devesh Sachdev | Promoter | 6.58% | 4.87% |
| Mini Sachdev | Promoter Group | 0.36% | 0.21% |
| Devesh Sachdev | Promoter | — | — |
| Creation Investments Fusion, LLC | Promoter Group | — | — |
| Creation Investments Fusion II, LLC | Promoter Group | — | — |
| Honey Rose Investment Ltd | Promoter Group | — | — |
| Devesh Sachdev | Founder Promoter | — | — |
| Warburg Pincus LLC (through Honey Rose Investment Ltd) | Promoter | — | — |
| Creation Investments Fusion, LLC and Creation Investments Fusion II, LLC | Promoter | — | — |
| Devesh Sachdev | Promoter | 6.58% | — |
| Creation Investments Fusion, LLC | Promoter (Corporate) | — | — |
| Creation Investments Fusion II, LLC | Promoter (Corporate) | — | — |
| Honey Rose Investment Ltd | Promoter (Corporate) | — | — |
| Devesh Sachdev | Promoter | 6.59% | — |
| Creation Investments Fusion, LLC, Chicago, U.S.A. | Promoter | 18.17% | — |
| Creation Investments Fusion II, LLC, Chicago, U.S.A. | Promoter | 11.80% | — |
| Honey Rose Investment Ltd, Mauritius | Promoter | 48.65% | — |
| Not disclosed in this part | Promoter | — | — |
| Devesh Sachdev | Promoter | — | — |
| Mini Sachdev | Promoter | — | — |
| Honey Rose Investment Ltd | Promoter Group | — | — |
| Creation Investments Fusion, LLC | Promoter Group | — | — |
| Oikocredit Ecumenical Development Cooperative Society U.A. | Promoter Group | — | — |
| Global Impact Funds, S.C.A., SICAR | Promoter Group | — | — |
Leadership
Devesh Sachdev · Promoter
Auto-extracted from the company's RHP using AI, with each fact linked to its source passage (hover any row to see the quote & page). Provided for research only, not investment advice — verify against the official RHP before relying on it.
Fusion Micro Finance IPO FAQs
What is the lot size of Fusion Micro Finance IPO?
The minimum lot size of Fusion Micro Finance IPO is 40 shares. One lot costs ₹14,720 at the cut-off price.
When does Fusion Micro Finance IPO open and close?
Fusion Micro Finance IPO opened for subscription on 02 Nov 2022 and closed on 04 Nov 2022.
What is the listing date of Fusion Micro Finance IPO?
Fusion Micro Finance IPO listed on 15 Nov 2022.