Repco Home Finance Ltd IPO – You should subscribe

Latest Initial Public Offerings (IPO)Repco Home Finance Ltd IPO

Chennai based, Repco Home Finance Ltd is coming up public issue for Rs 270 crores at a price band of Rs 165 to Rs 172. Should we subscribe to Repco Home Finance IPO?

About Repco Home Finance Ltd




Repco Home finance is professionally managed and NHB registered housing finance company promoted Repco Bank – Govt. of India enterprise.

As per R Varadarajan, Managing Director of Repco Home finance Ltd, its unique selling proposition is their target audience. Majority of them are non-salaried people, small business owners, traders etc. Its business focus is in Tier-II and Tier-III cities. Its average ticket size is Rs 9 lakhs and average tenure is nine years. Repco Housing finance business is in Southern states, West Bengal and Odhisa. Currently it is the process of expansion in Maharastra and Gujarath. Its loans increased from Rs 2,430 of earlier financial year to Rs 3,100 to last financial year

Issue details:




  • IPO opens: 13-Mar-2013
  • IPO closes: 15-Mar-2013
  • Issue price: Rs 165 to Rs 172 per share
  • Minimum bid: 75 shares and in multiples of 75 shares thereon.
  • Book Running Leader managers (BRLM): SBI Capital Markets Ltd, IDFC Capital Ltd, JM Financials Ltd
  • Listing: BSE / NSE
  • Prospectus: http://www.sebi.gov.in/cms/sebi_data/attachdocs/1317709033270.pdf

Purpose of the IPO: Company intends to utilise the issue proceeds for augmentation of capital base to meet future capital requirement

Company financials




Repco Home Finance Ltd – Financials
Financials 2007 / 03 2008 / 03 2009 / 03 2010 / 03 2011 / 03 2012 / 03

6 months-




Sep-12

Revenues (Rs in Millions) 443.74 713.9 1148.2 1642.8 2259.5 3188.85 1888.4
Profits (Rs in Millions) 115.5 156.3 266.3 455.8 581.5 614.6 256.14
Profit % 26.03% 21.89% 23.19% 27.75% 25.74% 19.27% 13.56%
               
YoY growth   61% 61% 43% 38% 41% NA

Company is doing well in terms of financials. Its revenues has grown from Rs 443 million (Year ending Mar-2007) to Rs 3188 million (year ending Mar-2012). Profit margins are maintained consistently above 22% except in previous financial year where the margins are 19.27%. The company has healthy capital adequancy ratio of 16.5% for the period ended Sep-2012 against the mandatory requirement of 12%.

Recommendation / Investment strategy: ICRA has given the issue rating as 3 out of 5 which indicate average fundamentals. Its average EPS is around Rs 13 in the last 3 fiscal years and Rs 7.67 for the 6 months ended Sep-2012. Considering the strong financials and good growth story, one can look at moderate investment in such IPO.

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Suresh
Repco Home Finance Ltd IPO



The Author

Suresh KP

Suresh KP i.e. me have written 1,500+ articles on this blog. I love doing analysis on various Best Investment Plans like mutual funds, Stocks, IPO's, NCD Bonds, Insurance products. If you like our blog, you can share some of the good articles on your Facebook or Twitter. This would be the BIGGEST gift which you would be giving to us.

4 Comments

Add a Comment
  1. Mr Suresh, as per your reco, i subscribed for repco home finance, now it is 20% up from issue price. what should I do? I want more more returns, can i hold

    1. Mahesh, What is your risk appetite. If you are low or medium risk appetite person, pls sell them and make profit. Else you can still wait for some more time to book profits

  2. how to invest in this. Is this trough mutual fund?

    1. Durgesh, You need to have demat account to purchase any stocks or to invest in any IPO.

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