CreditAccess Grameen Limited IPO Message Board (Page 18)

........... Credit Access Grameen............

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- 3rd largest MFI in gross loan portfolio
- multinational Promotors
- mainly focused on south and maharashtra
- hv some Best industry ratio
CRR : 90%(Avg 78%)
Cost to income : 38%
Ticket size : 10k(Avg 20k)
lowest opex ratio, lower interest rate.

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Last 3 yr CAGRs
Revenue : 48%
PAT : 37%
Net interest income : 54%
AUM : 57%
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Rii form reqd = 2.7L near
expecting 3L overall i.e allotment chances 1/1.
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Peers : None
As 80% operation of CAG are among rural areas(As name suggests)
While other MFI are more focused on urban and semi urban, also some peer converted to SFB from MFI.
Still nearly comparable...

Peers
............ PB....M/A....NNpa.....Rg......Pg

CAG___2.9x...1.22x....0.1%.....36%....22%
BFI____5.3x...1.2x.....0.1%....27%....22%
Ujji____2.7x....0.6x.....0.4%...25%.....(-)
Equ___2.8x.....0.6x.....1.7%...24%....(-)
Satin__1.8x.....0.3x....2.6%....34%....(-)
Indo___2x.......0.7x.....1.1%....12%....9%

M/A : M.cap/AuM
Nnpa : net npa ,GNPA =2%
Rg: CAgR revenue growth 16-18
Pg : CaGr revenue growth 16-18

Rg, Pg could have been higher if there was No DeMo.

Here, CAG asking higher valuation to all peers, especially considering M/A

__________
@422

M.cap = 6050 crore
PE : 37x
PB : 2.9x(BV post issue :145)


@1 M/A = 349 ( attractive value)
@2.6x PB = 380 ( fair ) - at where most peer trading
@3X PB = 435 INR ( moderate )


Given M. Cap = AUM, because of CAG's good quality and higher CAGRs, although most peer trading 0.3-0.7x only


For 2019,AUM may near 6500cr, BV 170
@1 M/A = 453 INR
@3x PB = 510 INR

RonW cont.ly decreasing
2016-17-18........18%-11%-9%



ConcL......

Minor listing gain may possible due to MNC Credit Access Asia being the promotor.

One may subscribe if targeting more than 1 yr or may consider buying post issue if available near/below fair price.


Note : Consider above all as an imo only ????

Gamble Sir, Thank you for this analysis..I am glad you moved away from PE based analysis, but significance of greater emphasis on Mcap/AuM is incomprehensible to me. Please throw some light to it

Gamble sir, Can we buy credit grameen now looking at present nifty level?

Sorry for the offbeat question, can anyone still consider TCS buyback @1975? Are there any chances it will go down after 18-8 (record date)?

One can get chance of earning 8,500 to 9,500/- (based on 2 side delivery brokerages) on investment of 200,000/- for 1.5 months.

In Retail category for 95 shares, chances of acceptance is 100% as we seen in last buy back of TCS, thus price does not matter. You are buying at 1,975/- and selling @2,100/-.

@dpcdsl, It's interesting if acceptance is 100% and most of news are saying that it'll be around 60% to 70%. And that is what I was bit of concerned about, since I feel after record date (18-8), it may fall down to 1800 range, thus removing all the benefits that you've got from buyback, if you have to sell your remaining 30% @1800 range.

Off the topic : Can anyone still consider HCL buyback @960? what would the acceptance ratio based on previous buybacks?

TCNS subscribed 13 times in QIB and 5 times in HNI still not helped retailers to sale it above issue price after 10 min. of listing. It is not advisable to see last moment subscription as no. of shares of this company higher than TCNS which may create selling pressure.
I am not going to apply this time. However I still believe that it can give 5% listing gain but no regret on losing this opportunity. Management has clarified that they are not willing to apply banking license in near term which caused cold response from bidders.

Looking to subscription all will get allotment !!! Due to heavy floating stock , I do not expect any gain & downward risk is also expected ,AVOID

@gamble,
Excellent analysis Sir. Your opinion is always counted for a final decision. Thank you.

If not fully subcribe will it decrease the issue price

It will subscrb fully ( RI may not ) , QIB will put bids today...final sub should more then 3 times ...mostlly around 4 to 5 times..

These days even "moongfali" packaging companies seem to get good anchor list, looks rigged to me!

Anyway, in-spite of foreign promoters etc., hype and hoopla, this ipo looks tad dampening to me, concentrated areas of operation, mostly female clientèle (though mostly paying up), but less chances of diversification into other target lending groups, new areas of operation, only they seem to increase loan ticket size. Also... fully valued in terms of issue price, I'm staying out till last day @12PM, till now no QIB or significant activity in subs. figures!

Free to comment, all...

people had similar views for BB also which was initially a micro finance company only with most of the offices in rural areas . But later every one ran behind it.
I don't mean CreditAccess would be a hit like BB but it may perform well on listing day.

Yes, I know the bandhan story myself (they established themselves from about 5km from where I live), applied on contra bet and still holding... But rarely can I relate this IPO to bandhan, my convictions maybe!

What is NPA status for this NBFC?

@ V

It's not expensive brother ..I believe it's priced to perfection. ...I like their clientele, not (just) because they are women oh! please :D , but because I expect middle class women with family to generally loathe the idea of absconding with paltry loan amounts secured after rigorous background checks and creditworthiness or getting incessant recovery calls from (not so)gentlemen....

But then it's the market participants who must shape the price chart and you know what happens when Karthik starts calling Karthik ..I mean when the fear or greed is instilled in the minds of people ...So to sum up most things, I would say go for it and leave the rest for the luck to decide.

Here comes my friend anarchist with his rhetorics and witty willy wonkas! Hope he is not applying just like myself....

Looking at the trend in QIB subscription, will take risk and make 2 applications for 1 lot each tomorrow afternoon..

Let the jury be out at around 14:30 tomorrow

Hi,
I will go for 3 lot ,it's micro finance company and it will not dispoint.

Thanks @abdixit, I appreciate it.

What do you think about TCS buyback and Mphasis buyback?

FIGURES ARE ATTRACTIVE AND WORTH APPLYING ATLEAST ONE APPLICATION
Summary of financial Information (Restated)
Particulars      For the year/period ended (in Rs. Millions)
31-Mar-18      31-Mar-17      31-Mar-16      31-Mar-15      31-Mar-14
Total Assets      52,183.48      35,640.72      28,079.76      17,268.09      10,580.80
Total Revenue      8,752.05      7,092.61      4,667.19      2,814.28      1,478.29
Profit After Tax      1,246.41      802.98      832.41      487.32      166.26

Teach such greedy company and leads manager a lesson by not subscribe the issue. It will send a clear message to them when promoter want to exit at maximum price

2ND DAY FLOP SHOW...........ONLY 37% total subscription.......

ya all brockers say apply for long term..........abi bi wohi rai he meri apply for long term......ok ahirer..

@ sonal patel
on 4 aug u had recommended for both listing as well as long term

As suggested by others due to long duration it has some disadvantage ..but i belive it will have final sub figure in ranage of 4 to 5 times ...

https://www.moneycontrol.com/news/business/ipo/ideas-for-profit-creditaccess-grameen-ipo-sound-business-in-a-risky-sector-subscribe-for-the-long-term-2819181.html/amp

Does ASBA Funds blocked are eligible for interest till the amount gets debited ?

Interest are payable only on Savings A/c and in Current a/c no interest is payable by bank, thus Intuitional investors do not get any interest on blocked a/c in current a/c.

Yes.

Only 0.37 times subscribed after completion of 2nd day.......
Due to poor subscription figure ,One can give a miss to this ipo.

CreditAccess Grameen Limited IPO Analysis
Risks
-      Collateral free loans as mandated by RBI for NBFC-MFIs(Micro-Finance Institution)
-      Credit Risk as customers do not have any credit history
-      Increase in Gross Non-performing Assets(NPA) Ratio from 0.08% to 1.97% in last 1 year
-      Central and state government decisions such as demonetization, farmer loan waivers
-      threats from newer business models that leverage technology

Strengths/Rewards
-      Strong track record of financial performance and operating efficiency
-      Robust customer selection and risk management policies which have resulted in healthy asset quality and lower credit costs
-      Higher rate of timely loan recovery due to constant peer pressure and regular engagement with borrowers in joint liability group ("JLG") model
-      2nd lowest average interest rates (upto 22%) next only to Bharat Financial
Inclusion Limited among NBFC-MFIs
-      High Active customer retention rate (90%) and lowest average ticket size among peers
-      Deep penetration in less competitive and unorganized rural area.
-      Credit Rating 'A', with changed outlook rating from "stable" to "positive"
-      Well geographic diversification of loan portfolio across 132 districts with no single district contributes more than 5% of total Gross AUM.
-      According to CRISIL Research, lowest operating expense amongst the top-eight NBFC-MFIs and SFBs for the year ended 2017.
-      Adoption of technology to improve operational and management efficiencies and lower costs
-      Stable management team with extensive domain experience
-      3rd highest ROA and ROE amongst NBFC-MFIs
-      NBFC-MFI's portfolio to grow at 26% CAGR in the next 2 years

Conclusion
Looking at significant growth opportunities to the company due to surplus fund from fresh issue, scope to expand in other states of Rural India, good finance track record, lowest operating expense, superior among the peers considering overall parameters but at issue price there is very less gain left on table on listing. So my say is 'NEUTRAL' for listing gain (0 to 10%) but looking at 6 months to 1 year down the line company can give lucrative gain to investors. My recommendation is 'Subscribe' for long term investors.

dusro ke bharose hi ho kya...

Subscription level are very low. No interest of QIB / NII.
Grey Market Premium is down nearly Rs. 8 with only sellers.
So AVOID this IPO. Don't take risk. Wait for another good IPO.