Manba Finance is a well-established non-banking financial company (NBFC) based in Mumbai, India.
Founded in 1996, the company has built a reputation for offering a wide range of financial services, particularly in vehicle financing.
Over the years, Manba Finance has gained prominence in the sector, focusing on meeting the diverse financial needs of individuals and small businesses.
Manba Finance's IPO Overview
- 100% book building IPO of 1,25,70,000 shares priced between Rs 114-120 per equity share.
- 50% allocated to Qualified Institutional Buyers (QIBs), and 5% to mutual funds.
- 15% available for non-institutional bidders, and 35% for retail investors.
- The issue opens on September 23, 2024, and closes on September 25, 2024.
- Shares listed on BSE and NSE.
- Face value is Rs 10 with prices ranging from 11.40 to 12.00 times.
- Book running lead managers: Hem Securities.
Manba Finance Profile
Non-Banking Financial Company-Base Layer (NBFC-BL) offers financial solutions for various vehicles.
AUM size of over Rs 90,000 lakh as of March 31, 2024.
97.90% of the loan portfolio comprises New Vehicle Loans.
Target customers seeking quick loan sanction and disbursement.
Operates out of 66 locations with 29 branches across 6 states.
Established relationships with over 1,100 Dealers across 6 states.
Recently expanded loan portfolio to Used Car Loans, Small Business Loans, and Personal Loans.
A centralized credit team reviews loan applications remotely.
Credit decisions are based on customer’s credit data.
Comprehensive credit assessment, risk management, and collections framework.
Credit decisions are based on internal credit policies, LTV, customer cash flows, CIBIL score, and collateral.
Business processes and technologies facilitate sanctioning over 85% of loans on the same day of application.
The in-house collection team focuses on monthly installment recovery.
The collection management process includes account-level tracking, query resolution, and legal action initiation.
Pros and Strengths
Strong Dealer Network
It commenced operations in 1998 as a NBFC in Mumbai, Maharashtra.
Scaled operations to vehicle financing in 2009.
Strong relationships with over 1,100 Dealers, including over 190 EV Dealers across Maharashtra, Gujarat, Rajasthan, Chhattisgarh, Madhya Pradesh, and Uttar Pradesh.
The dealer network acts as a point of sale in the business model.
Scalability
- Scaled operations from 2009 to now in 66 locations across six Indian states.
- Initially focused on Maharashtra, expanded to Gujarat, Rajasthan, Chhattisgarh, Madhya Pradesh, and Uttar Pradesh.
- Prioritizes market dynamics, competition, and dealer networks before location establishment.
- Utilizes Vahan and FADA portals for population and market size data analysis.
- Establishes systems for local opportunity identification, customer selection, loan approval, and collection monitoring.
Cost-Effective long-term Borrowing
- Secures funding from diversified sources including public and private sector banks, small finance banks, and PTC.
- Develop long-term relationships with banks, NBFCs, and other financial institutions.
- Borrows funds from these sources and lends them to customers for asset acquisition or funding needs.
- Uses various financial structures and issues financial instruments for cost-effective borrowing.
- Utilizes financial instruments like NCDs and PTC for optimal financial management and controls.
Co-lending arrangement with Muthoot Capital Services Limited on an 80:20 fund-sharing basis.
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Future Outlook
Manba Finance has positioned itself as a trusted name in vehicle financing and personal loans.
As the Indian economy continues to grow and demand for financial products increases, the company is well-placed to expand its services, particularly in the semi-urban and rural segments.
With plans to leverage digital platforms, Manba Finance is likely to enhance its offerings and improve customer experience further.
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