Mumbai-based Nisus Finance Services Co Limited (NiFCO), a major player in the non-banking financial sector (NBFC), recently received approval from the Bombay Stock Exchange (BSE) to launch its SME initial public offering (IPO). This IPO aims to raise funds to support the company’s expansion plans and boost its position in the financial sector.
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Details of the IPO
The IPO includes the issuance of 6.5 million equity shares, each with a face value of ₹10. This offering consists of:
- New Shares: 5.78 million shares
- Offer for Sale (OFS): 720,000 shares for existing stakeholders
This fundraising initiative is expected to enhance NiFCO’s capabilities across different areas of finance and help it build a stronger market presence.
Purpose of the IPO: Where Will the Funds Go?
Nisus Finance intends to use the IPO funds to support its strategic projects and grow its domestic and international reach. The funds will be allocated to:
- Infrastructure Expansion: Developing its infrastructure in key financial hubs like IFSC-Gift City in Gandhinagar, DIFC in Dubai, and FSC in Mauritius.
- Obtaining Licenses: Acquiring new financial licenses to expand its services.
- Fund Management Enhancements: Improving its fund management capabilities.
- Strengthening Capital Base: Investing in its affiliate, Nisus Fincorp Private Limited, which specializes in small and medium enterprise (SME) financing.
This IPO will also help cover the costs associated with fundraising and support general corporate purposes.
About Nisus Finance Services
Nisus Finance, operating under the brand “Nisus Finance Group” (NiFCO), has been in the financial sector for over a decade, focusing primarily on urban infrastructure financing and private capital markets. Currently, NiFCO manages assets worth approximately ₹1000 crore (FY 2024) and has earned a reputation for excellence with a high fund manager rating from CareEdge Ratings. Known for alternative investment funds (AIFs) and diverse asset management, NiFCO has built expertise in SME and real estate financing.
Financial Highlights
As of January 31, 2024, Nisus Finance posted:
- Revenue: ₹3,077.21 lakh
- EBITDA: ₹2,459.95 lakh
- Profit After Tax (PAT): ₹1,687.96 lakh
Promoted by Amit Anil Goenka, NiFCO has built a strong foundation in the financial sector with a focus on local market expertise and delivering impactful financial solutions.
Potential Benefits for Investors
For investors, NiFCO’s IPO offers an opportunity to engage with a growing NBFC that has been consistently expanding and improving its financial services. As NiFCO strengthens its international reach and develops new financial products, its growth potential appears promising. The company’s plans to expand into financial hubs like Dubai and Mauritius could enhance its revenue streams and provide diversified assets for investors.
Growth Potential in the SME Sector
The SME sector in India is growing rapidly, and NiFCO’s focus on this area aligns well with current market trends. By reinforcing its position in the SME financing space, NiFCO is well-positioned to capitalize on this growth and further its impact in the financial services sector.
My Opinion
NiFCO’s IPO presents a strong case for investment, especially given its emphasis on expanding infrastructure in international financial hubs. However, like any IPO, this investment carries some risks, including the challenges of international expansion and maintaining steady growth. Investors should also consider NiFCO’s reliance on the SME sector, which can be sensitive to economic shifts.
Conclusion
With BSE’s approval, NiFCO is poised to capitalize on opportunities in both domestic and international markets. Its commitment to infrastructure expansion and support for the growing SME sector may attract investors seeking exposure to a promising NBFC. While it’s important to weigh potential risks, NiFCO’s IPO offers a solid avenue for participating in the growth of the Indian financial sector. This IPO could be an exciting development for both NiFCO and investors looking to support a company with a clear growth strategy and an expanding footprint.
