Shares of Home First Finance Company India Ltd made a firm stock markets debut on Wednesday. The stock was listed at Rs .80, up 19.45 from its issue price of Rs 518 apiece.
The issue with a price band of Rs 517-518 per equity share was open for subscription on 21-25 January. The issue was subscribed 26.66 times. “Aided by its high growth momentum on a smaller base, superior underwriting standards, and efficient collections management the company delivered a healthy return on assets (RoA) of 2.7 per cent in FY20. Return on equity (RoE) of 11% looks modest owing to lower leverage at 4 times in FY20. The issue is priced at a post-money price to book value of 3.4 times compared to its nearest competitor Aavas Financiers which trades at 6.8 times on September,” said Yes Securities in a note ahead of the issue.
Home First Finance is a technology-driven affordable housing lender. It offers housing loans for buying or constructing homes. Its gross loan assets have expanded at a compound annual growth rate of 63.4 per cent between FY18 and FY20, as per company documents.
It focuses on first-time homebuyers in low and middle-income groups, offering housing loans for the purchase/construction of homes. Over the last 10 years, the company has sanctioned home loans to more than 50,000 customers in 60 districts, across 11 states and 1 union territory.
The Company recently raised Rs 346 crore from 25 anchor investors which included institutions such as Nomura, Fidelity International, Eastspring, Morgan Stanley IM, Buena Vista, TT International, Grandeur Peak, Moon Capital, and Discovery. Some of the renowned DIIs included ICICI Prudential MF, Birla MF, Nippon MF, White Oak, Sundaram MF, Motilal MF, IIFL AIF, Birla Life, Bharti AXA, Tata AIA, Edelweiss PE, Motilal AIF amongst others. The shares were allotted to anchor investors at Rs 518 per equity share.

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