Manappuram hopes to take MFI arm Ashirwad public
Manappuram Finance, the second-largest gold loan company in the country, is playing with hiving off and taking its microfinance arm Asirvad Microfinance public inside a year, a top company official said. With a loan arrangement of over Rs 5,360 crore and near 25 lakh customers across 23 states, the Chennai-headquartered Asirvad is the fourth largest microfinance lender in the country in terms of the loan book.
Founded in 2008 by S V Raja Vaidyanathan, Asirvad was taken over by Manappuram in February 2015 for Rs 48.63 crore. The V P Nandakumar-drove company initially purchased 71 percent stake which was subsequently expanded to 95 percent and the rest is with the originator Vaidyanathan. Under Manappuram, Asirvad has developed leaps and limits. From a loan book of just Rs 300 crore and a couple of lakh customers across 115 branches in Tamil Nadu, Kerala and Karnataka when it was purchased over, the company has over 1,030 branches across 314 regions in 23 states (barring Andhra Pradesh and Telangana) and a loan book of over Rs 5,358 crore starting at 2020-end, of which over Rs 1,000 crore is in Tamil Nadu alone.
As of the December 2020 quarter, Asirvad had a loan book of Rs 5,357.71 crore, a development of 6.68 percent from Rs 5,022.14 crore in the year-prior quarter. This makes the microlending arm the greatest vertical after the gold loan business for the gathering.
“We are planning to hive off Asirvad inside a year, and afterward take it public. We are taking a gander at the correct valuation. I’m taking a gander at a cost to book worth 3-4 times, which is multiple times presently,” author and CEO of Manappuram Finance Group, V P Nandakumar told me.