Northern Arc Capital IPO Launch: Check Date, Price, GMP, and Full Review

On Saturday, September 14, 2024, Northern Arc Capital, a leading diversified financial services platform, announced its highly anticipated initial public offering (IPO). The IPO, which aims to raise ₹777 crores, is set to open for subscription on Monday, September 16, and will remain open until Thursday, September 19.

What is Northern Arc Capital IPO?

Northern Arc Capital, established in 1989, is a non-banking financial company (NBFC) that primarily focuses on providing debt finance to underserved households and businesses in India. The company operates in various sectors, including microfinance, MSME finance, vehicle finance, consumer finance, affordable housing finance, and agriculture finance.

Northern Arc Capital IPO Date Announcement

The IPO date was officially announced on Saturday, September 14, 2024. The issue will open for subscription on September 16 and close on September 19. The anchor investor bidding will open on Friday, September 13.

Northern Arc Capital IPO Share Price Range

The company has set a price band of ₹249 to ₹263 per equity share for the IPO. At the upper end of the price band, Northern Arc Capital will have a post-listing market capitalization of ₹4,244 crores.

How to Apply for Northern Arc Capital IPO

Investors can apply for the Northern Arc Capital IPO through their 5paisa account. The minimum application lot size is 57 shares, and retail investors can apply for up to 13 lots.

Northern Arc Capital IPO Lot Size Details

The minimum application lot size for the Northern Arc Capital IPO is 57 shares, and retail investors can apply for up to 13 lots, which amounts to 741 shares or ₹194,883.

Northern Arc Capital IPO DRHP Analysis

The company filed its Draft Red Herring Prospectus (DRHP) with SEBI on July 15, 2021, and received regulatory approval in September of the same year. The DRHP provides detailed information about the company’s financials, business model, and growth prospects.

Northern Arc Capital IPO Financial Performance

Northern Arc Capital has reported a strong financial performance in recent years. For the financial year ended March 31, 2024, the company reported a net profit of ₹317.69 crores and a revenue of ₹1,906.03 crores.

Northern Arc Capital IPO Business Model Explained

Northern Arc Capital’s business model is diversified across offerings, sectors, products, geographies, and borrower segments. The company provides financing directly and indirectly through its Originator Partners, reaching out to over 10.18 crore people across India as of March 31, 2024.

Top Stocks to Buy After Bajaj Housing Finance IPO Impact: Potential for 30% Surge

Arkade Developers IPO: Monday Opening, GMP Trends, and Allotment Date Details

Northern Arc Capital IPO Grey Market Premium

Ahead of the issue opening, the grey market premium (GMP) for Northern Arc Capital remained nil. However, it is important to note that grey market premiums are just an indicator of how the company’s shares are stacked up in the unlisted market and are subject to change rapidly.

Northern Arc Capital IPO Subscription Status

The subscription status for the Northern Arc Capital IPO will be updated regularly on the company’s website and stock exchange platforms. Investors can track the subscription levels for each investor category.

Northern Arc Capital IPO Allotment Process

The allotment for the Northern Arc Capital IPO is expected to be finalized on September 20, 2024. The basis of allotment will be determined by the lead managers and the company, based on various factors such as the issue size, demand, and investor category.

Northern Arc Capital IPO Listing Date Prediction

The company is expected to list on the BSE and NSE on September 24, 2024, subject to regulatory approvals and market conditions. The listing date is tentative and may change based on various factors.

Northern Arc Capital IPO Pros and Cons

Pros:

• Diversified business model across offerings, sectors, products, geographies, and borrower segments
• Strong financial performance and growth prospects
• Experienced management team and robust risk management processes

Cons:

• Exposure to high-risk borrowers and potential for defaults
• Highly regulated industry with potential for negative developments
• Dependence on external funding sources

Northern Arc Capital IPO Risk Factors

The company has highlighted various risk factors in its DRHP, including regulatory changes, competition, and the potential for defaults. Investors should carefully consider these risks before investing in the IPO.

Northern Arc Capital IPO Promoter Background

Northern Arc Capital is promoted by a team of experienced professionals with a strong track record in the financial services industry. The promoters have played a key role in the company’s growth and success over the years.

Northern Arc Capital IPO Fund Utilization Plan

The company plans to use the proceeds from the fresh issue to meet its future capital requirements for onward lending. The funds will be used to support the company’s growth and expansion plans in the coming years.

Northern Arc Capital IPO Market Share Analysis

Northern Arc Capital is a leading player in the diversified NBFC space in India. The company has a significant market share in various sectors, including microfinance, MSME finance, and consumer finance.

Northern Arc Capital IPO Competitive Landscape

Northern Arc Capital operates in a highly competitive industry, with several players offering similar products and services. However, the company’s diversified business model, strong risk management processes, and partnerships with Originator Partners give it a competitive edge in the market.

Northern Arc Capital IPO Growth Prospects

The company’s growth prospects are closely tied to the growth of the financial services industry in India. With increasing financial inclusion and the growing demand for credit, Northern Arc Capital is well-positioned to capitalize on these opportunities and drive its growth in the coming years.

Northern Arc Capital IPO Valuation Metrics

At the upper end of the price band, Northern Arc Capital is valued at a post-issue market capitalization of ₹4,244 crores. The company’s valuation is based on various factors, including its financial performance, growth prospects, and competitive positioning in the market.

Northern Arc Capital IPO Retail Investor Allocation

The company has reserved 35% of the net offer for retail investors, providing them with an opportunity to participate in the growth story of Northern Arc Capital.

Northern Arc Capital IPO Institutional Investor Interest

The IPO has garnered significant interest from institutional investors, with 50% of the net offer reserved for qualified institutional buyers (QIBs). The strong interest from institutional investors reflects their confidence in the company’s growth prospects and business model.

Northern Arc Capital IPO Underwriters Information

The book running lead managers for the Northern Arc Capital IPO are ICICI Securities, Axis Capital, and Citigroup Global Markets India. These reputed investment banks have a strong track record of managing successful IPOs in the past.

Northern Arc Capital IPO Regulatory Approvals Status

Northern Arc Capital has received all necessary regulatory approvals from SEBI and other relevant authorities to proceed with the IPO. The company has complied with all the regulatory requirements and has obtained the necessary clearances.

Northern Arc Capital IPO Sector Outlook

The financial services sector in India is expected to continue its growth trajectory in the coming years, driven by factors such as increasing financial inclusion, growing demand for credit, and the adoption of digital technologies. Northern Arc Capital is well-positioned to capitalize on these opportunities and drive its growth in the sector.

Northern Arc Capital IPO Key Management Personnel

Northern Arc Capital is led by an experienced management team with a strong track record in the financial services industry. The key management personnel have played a crucial role in the company’s growth and success over the years.

IPO Debt-to-Equity Ratio

As of March 31, 2024, Northern Arc Capital had a debt-to-equity ratio of 0.69, which is within the industry average. The company’s strong financial position and prudent risk management practices have helped it maintain a healthy debt-to-equity ratio.

Northern Arc Capital IPO Revenue Streams Breakdown

Northern Arc Capital generates revenue from various sources, including financing, syndication and structuring, and fund management. The company’s diversified revenue streams provide it with a stable and sustainable business model.

Northern Arc Capital IPO Future Expansion Plans

Northern Arc Capital plans to use the proceeds from the IPO to support its future growth and expansion plans. The company aims to expand its presence in existing markets and explore new opportunities in the financial services sector.

IPO Comparison with Peers

Northern Arc Capital competes with other diversified NBFCs in the market, such as Anicut Capital, Centrum Alternatives, and Vivriti Asset Management. The company’s strong financial performance, diversified business model, and partnerships with Originator Partners give it a competitive edge over its peers.