My Mudra Fincorp IPO lists at ₹130, surging 18.18% above the issue price

My Mudra Fincorp, a Channel Partner (DSA) for major banks and NBFCs in India, made a positive debut on the Indian stock market on 12th September 2024, with its shares listing at a premium to the issue price. The company's initial public offering (IPO) generated good demand from investors during its subscription period, setting the stage for a solid market debut.

Listing Details

• Listing Price: My Mudra Fincorp shares were listed at ₹130 per share on the NSE SME platform, marking a strong start to its journey as a publicly traded company.
• Comparison to Issue Price: The listing price represents a premium over the IPO issue price. My Mudra Fincorp had set its IPO price band from ₹104 to ₹110 per share, with the final issue price being fixed at the upper end ₹110.
• Percentage Change: The listing price of ₹130 on the NSE SME represents an 18.18% premium over the issue price of ₹110.

First-Day Trading Performance

• Opening vs. Closing Price: The stock opened at ₹130 per share.
• Market Capitalisation: The company's market capitalisation stood at approximately ₹125 crore.

Market Sentiment and Analysis

• Market Reaction: The market reacted positively to My Mudra Fincorp's listing. The listing premium indicates good demand and investor confidence in the company's prospects.
• Gains for Investors: Investors who received allotments in the IPO and sold their shares at the listing price would have realised gains of ₹20 per share or 18.18% over the issue price of ₹110.
• Grey Market Premium: Prior to listing, shares were trading at a premium of ₹36 in the grey market, suggesting an expected listing gain of 32.73% that was partially realised.

Growth Drivers and Challenges

Expected drivers of future performance:

• Wide range of financial products for distribution and sale
• Expansion into insurance product sales
• Strong growth in revenue and profit

Potential Challenges:

• Competition in the financial services distribution sector
• Dependence on partnerships with banks and NBFCs
• Regulatory changes in the financial services industry

Utilisation of IPO Proceeds

My Mudra Fincorp plans to use the funds for:

• Repaying a portion of specific loans
• Investing in technology development and digital infrastructure
• Addressing working capital needs
• General corporate purposes

Financial Performance

The company has demonstrated strong financial growth:

• Revenue increased by 33% year-on-year from 31st March 2023 to 31st March 2024
• Profit After Tax (PAT) climbed by 141% during the same period

As My Mudra Fincorp begins its journey as a listed entity, market participants will closely monitor its ability to leverage its position as a Channel Partner for major financial institutions to drive future growth and shareholder value.