Repco Home Finance IPO opens today: 10 facts

. About company: Established in April 2000, Repco Home Finance is a wholly owned subsidiary of Repco Bank Ltd. It is engaged in providing individual home loans (85.6 per cent) and loans against properties (14.4 per cent). As of December 2012, it had 73 branches and 19 satellite centres, mostly in South India. Objective of the issue: To augment capital base to meet future capital requirements. Repco had a capital adequacy ratio of 15.9 per cent as of September 2012. Issue Snapshot: Issue opens today and closes on March 15, 2013. Price band of Rs 165 to Rs 172. Issue size of Rs 259 crore to Rs 270 crore. Issue size of 1.57 crore equity shares. Face value of Rs 10. Bid size of 75 equity shares and in multiples thereof. 100 per cent book built Issue. Capital structure: Repco's paid up equity capital will increase to Rs 62.2 crore post issue from Rs 46.4 crore currently, while the promoter holding will come down from 50.02 per cent pre-issue to 37.36 per cent post-issue. Profile: Repco Home Finance focuses on providing home loans in Tier- II and III cities. 53 per cent of consumers are from the non- salaried segment, while the average loan size was sub-Rs 10 lakhs. Performance: Relatively low cost funding from the National Housing Board (44 per cent) and other banks enables Repco Home to maintain healthy margins. Net interest margins stood at 3.8 per cent as of first half of current fiscal, while return on equity was at 22.2 per cent for the same period. Financials: Between fiscal years 2008-2012, Repco's loan book grew at a compound annual growth rate of 43.8 per cent, while net profit grew at a CGAR of 45.5 per cent. Loan book at the end of FY12 was Rs 2,802 crore. Peer comparison: Repco has the best NIM (4.2 per cent) as of Fiscal year 2012 among peers. LIC Housing, which is many-times bigger, reported a NIM of 2.4 per cent in FY12, while GIC Housing which is comparable in size had a NIM of 2.5 per cent in FY12. Rating: ICRA fundamental grade: 3/5 indicating average fundamentals. Concerns: Increasing competition in the domestic housing finance industry. Rise in non-performing asset levels in recent past, lower provision coverage ratio. Provision coverage ratio in the first half of current fiscal 2012-13 stood at 25.3 per cent.

Repco Home Finance IPO opens today: 10 facts

NDTV Profit

NDTV Profit

Follow Us

DOWNLOAD THE APP