Key Indian stock indices Sensex and the Nifty50 are languishing in negative territory after a weak start on the final session of Samvat 2073, with several front line counters witnessing some profit taking.
Meanwhile, MAS Financial Services, making its debut after a highly successful Initial Public Offering, got off to an upbeat start and is still trading firm, clocking impressive volumes on BSE and NSE.
The stock rose to Rs 670 on the National Stock Exchange, after opening at Rs 660, a hefty premium to the IPO price of 459. On BSE, the stock touched a high of Rs 668.35.
At Rs 674.40, off the day's low of Rs 625, the stock is now up 47% from the issue price. On BSE, the counter has clocked a volume of about 1.8 million shares. On the National Stock Exchange, the counter has recorded a volume of nearly 12 million shares so far in the session.
The Rs 460 crore IPO from the non-banking finance company, that came with a price band of Rs 456 - 459 a share, received very good response from investors and was oversubscribed 128.39 times.
The issue comprised of fresh issue of shares worth Rs 233 crore and an offer for sale of up to Rs 227 crore by existing shareholders.
The company had announced that it would use the net proceeds from its fresh issue for expanding the capital base to meet future requirements.
MAS Financial Services manages assets in micro enterprise, SME, commercial vehicles, two-wheeler and housing loan segments.
The company’s assets under management grew at a healthy 33.4% compounded annual growth rate (CAGR) over FY2013-17 with strong asset quality.
As of 31 March 2017 and 30 June 2018, MAS Financial Services' AUM was Rs 3332.6 crore and Rs 3451.7 crore, respectively.
At Rs 459, the issue price, MAS Financial was valued at 4.1 times of its book value on post dilution basis, more than its peers like Shriram City Union Finance and Capital First.
The company clocked average return on equity of 27.9% over last 5 years, substantially higher than a growth of about 11% reported by its peers in the industry.
The stock is likely to do pretty well going forward, thanks to the company's healthy asset quality and consistent good performance, and investors looking at medium to long term can consider adding this to their portfolio if the stock is not already part of it.
