The Reserve Bank of India has given the final nod for Bain Capital to acquire joint control of Manappuram Finance and its subsidiaries, including its arms Asirvad Home Finance and Manappuram Home Finance.
This was confirmed by Manappuram Finance in an exchange filing on Thursday, with the US-based private equity firm set to hold 41.66% control of the company on a fully diluted basis. Existing promoters, meanwhile, will hold 28.9% on a fully diluted basis.
Following the development, Manappuram Finance and its subsidiaries are now in receipt of all requisite statutory approvals for Bain Capital's proposed investment of approximately Rs 4,385 crore and joint control with the existing promoters, together with the consequent open offer under the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011, the company said.
Following the proposed transaction and completion of the open offer, Bain Capital will be classified as a promoter of Manappuram Finance and will jointly control the company along with the existing promoters.
What are brokerages saying about Manappuram Finance?
A few brokerages have come out with notes on Manappuram Finance following the RBI's final nod for the Bain Capital deal.
Jefferies believes infusion should be 4/2% Book Value accretive and 8/9% EPS dilutive over FY27-28. Moreover, net interest margins are likely nearing a bottom, although re-rating would hinge on a visible franchise turnaround. The brokerage firm is awaiting a strategic roadmap from the new CEO.
Overall, Jefferies has maintained a hold on Manappuram Finance with a target price of Rs 285.
As for Morgan Stanley, they have maintained 'equal-weight' on the counter with a target price of Rs 315. The firm believes the visibility of completion of the transaction could drive some near-term positive sentiment.
ALSO READ: RBI Grants Approvals To Bain Capital For Joint Control Of Manappuram Finance, Subsidiaries
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