Fusion Micro Finance‘s IPO was 2.13 crore shares in an IPO of 11.92 lakh equity shares on November 2, the first day of bidding, with a subscription rate of 6%.

The size of the offering has been reduced from nearly three crore equity shares to 2.13 crore shares after the MFI raised Rs 331 crore from key investors on November 1, the day before the offering began.

Retail investors bought 8% of the allocation, and non-institutional investors bid for 7% of the portion reserved for them. Qualified institutional investors have yet to bid.

Fusion Micro Finance plans to raise more than Rs 1,100 crore in the IPO, including a fresh issue of shares worth Rs 600 crore and an offer of Rs 1.36 crore for sale by promoters and investors. The price range for the offer ended on November 4 at Rs 350-368 per share.

Fusion provides financial services to underserved women across India to help them access greater economic opportunities. Its key customer base is women in rural areas with household incomes up to Rs 3 lakh per annum.
The company had 29 lakh, active borrowers, as of June 2022, and its network of 966 branches and 9,262 employees serves 377 territories across 19 states and federal territories in India.

The company is highly diversified, with a broad pan-India presence and a rural focus. Hem Securities said it has access to diversified sources of capital and effective asset-liability management through robust underwriting processes and risk management policies.

The company’s stable and experienced management team, supported by numerous investors, has solid fundamentals and huge potential for future growth.

Also, at current levels, the offering appears reasonably priced, but given the industry, the brokerage recommends that risk-loving investors subscribe to the offering.