Northern Arc Capital IPO open for subscription: Check price band, offer size and other key details

Northern Arc Capital Limited's initial public offering (IPO) opened for subscription on Monday, September 16. The leading diversified non-banking financial company (NBFC) IPO will close for bidding on September 19.

The company had earlier filed draft papers with the Securities and Exchange Board of India (SEBI) in July 2021 to float its IPO but didn’t proceed with the launch despite getting a go-ahead from the market regulator.

After a failed attempt, the company has now successfully launched its issue in the market. In case you are planning to invest in the Northern Arc Capital IPO, here are all the important details you need to know:

About the Northern Arc Capital IPO offer size

The Northern Arc Capital IPO is a book-building issue aimed at raising ₹777 crore. The issue is a combination of fresh issuance of 1.9 crore shares aggregating to ₹500 crore and an offer-for-sale (OFS) of 1.05 crore shares aggregating to ₹277 crores.

Under the OFS, Leapfrog Financial Inclusion India (II) Ltd, Eight Roads Investments Mauritius II Ltd, Accion Africa-Asia Investment Company, Sumitomo Mitsui Banking Corporation, Dvara Trust and 360 ONE Special Opportunities Fund (formerly IIFL Special Opportunities Fund) plan to offload their stakes.

ICICI Securities Ltd, Axis Bank Ltd and Citigroup Global Markets India Pvt. Ltd are the book-running lead managers of the Northern Arc Capital IPO, while Kfin Technologies Ltd is the registrar for the issue.

Northern Arc Capital has reserved 58 lakh shares for the qualified institutional buyers (QIBs), more than 43.51 lakh shares of r the non-institutional investors (NIIs) and 1.01 crore shares for the retail segment.

The issue also includes a reservation of up to 590,874 shares for employees, who will also be offered a discount of ₹24 on the issue price.

Northern Arc Capital IPO price band and lot size

Northern Arc Capital IPO price band has been set at ₹249 to ₹263 per share. The lot size, or the minimum bid quantity, for an application is 57 shares. This translates into a minimum application amount of ₹14,991 for retail investors.

Northern Arc Capital IPO allotment status and listing date

The Northern Arc Capital IPO opens for subscription on September 16 and closes on September 19. The share allotment status is expected to be finalized on September 20.

Successful bidders who are allotted shares can expect them to be credited in their Demat accounts by September 23, while refunds for others would be initiated on the same day. The Northern Arc Capital stock is expected to be listed on Tuesday, September 24, on both the BSE and the National Stock Exchange of India (NSE).

Northern Arc Capital IPO objective

Northern Arc Capital proposes to use the net proceeds from the fresh issuance to meet future capital requirements for onward lending. The proceeds from the OFS would go directly to the selling shareholders and would not be used by the company.

Anchor investors in the Northern Arc Capital IPO

The Northern Arc Capital IPO raised ₹228.86 crore from anchor investors. At its meeting held on September 13, the company finalised the allocation of almost 87 lakh shares at an allocation price of ₹263 per share. The list of investors included Quant Mutual Fund, SBI Life Insurance Co. Ltd, SBI General Insurance Co. Ltd, Kotak Mahindra Life Insurance, Goldman Sachs (Singapore) Pte, and Societe Generale, among others.

About Northern Arc Capital

Northern Arc Capital Ltd was founded in 2009 and offers retail loans to underserved households and businesses in India.

The company follows a multi-channel approach to enable access to debt capital. Its three primary channels are lending, placements and fund management.

As of March 31, 2024, the company had facilitated over ₹1.73 trillion worth of financing, reaching out to over 101.82 million people across India.

The company’s revenue increased by 45% to ₹1,906 crore in 2023-24 compared with ₹1,311.2 crore in 2022-23. Profit after tax (PAT) rose by 31% to ₹317.69 crore in FY24 from ₹242.21 in FY23.