IBL Finance IPO Financial Analysis

IBL Finance makes borrowing easier and faster by using technology. They offer personal loans through a mobile app, even to people in rural areas is set to launch its IPO on 9 January 2024. Here's a summary of the company's business model, strengths, weaknesses, and growth prospects to assist investors in making informed decisions.

IBL Finance IPO Overview

IBL Finance Ltd, established in 2017, is a fintech-based financial services platform that utilizes technology and data science for efficient lending. The company aims to overcome traditional lending constraints by simplifying processes and catering to the unique needs of borrowers. Operating mainly through a mobile app, it offers a 100% digital process, ensuring quick disbursement of small personal loans, often within 5 minutes, without needing physical presence or extensive paperwork.

IBL Finance has disbursed over ₹720 million across 165,000 personal loans. IBL Instant Personal Loan app boasts more than 5 lakh downloads, with 3,81,156 logins in the latest year. The app sees an average monthly activity of over 28,000 users. company, with eight branches in Gujarat and Maharashtra, employs 81 full-time staff. IBL Finance leverages over 500 data points to generate comprehensive credit reports. This approach allows individuals in semi-urban and rural areas, lacking traditional documentation, to access loans based on alternative data points.

IBL Finance IPO Strengths

1. Focusing on a mobile-first strategy enhances customer engagement and overall experience.
2. Company uses smart risk management and advanced technologies like data science and machine learning to enhance operations.
3. The company is led by a reliable and experienced management team.
4. Enhanced financial results.

IBL Finance IPO Weakness

1. Company mostly gives out unsecured loans. If it struggles to collect money from customers on time, it could hurt the company's operations and profits.

2. Company is dealing with more competition, and if it can't keep up, it might make less money due to lower profit margins.
3. The company's financial health could be negatively impacted by changes in interest rates. If they can't effectively handle this risk, it may hurt their profits and overall financial well-being.
4. Company needs a lot of money to run its business, and if there's any problem getting that money, it would hurt the company's financial health.

IBL Finance IPO Details

IBL Finance IPO is scheduled from 9 to 11 January 2024. It has a face value of ₹10 per share, and the IPO's price range is ₹51 per share.

Financial Performance of IBL Finance IPO

In the fiscal year 2021, IBL Finance had a negative free cash flow of Rs -8.3 million, which increased to -56.7 million in FY22 and further to -89.9 million in FY23.

Key Ratios

Profit After Tax (PAT) Margins for IBL Finance were -8.85% in FY21, improved to 13.15% in FY22, and further increased to 14.48% in FY23. Return on Equity for IBL Finance was -3.19% in FY21, improved to 12.08% in FY22, and slightly decreased to 9.42% in FY23.

Promoters of IBL Finance

1. Manish Patel
2. Piyush Patel
3. Mansukhbhai Patel

The company was founded by Manish Patel, Piyush Patel, and Mansukh Patel, with the current promoter holding at 85.55%. After the IPO's issuance of new shares, the promoter's equity holding will be diluted to 62.45%.

Final Words

This article takes a closer look into the upcoming IBL Finance IPO, scheduled for subscription from 9 January 2024. It suggests that potential investors thoroughly review the company's details, financials, subscription status, and the Grey Market Premium (GMP). GMP indicates the anticipated listing performance, providing valuable insights for investors to make well-informed decisions.