Ujjivan Financial is a bright star

Newly listed stock, Ujjivan Financial is easily the brightest shining star on the bourses today, rather for the few days. It has been consistently in the green, hitting new highs on 29 and 30^th June and then again yesterday at Rs.420.90 and now today too at Rs.427.40.

The stock had got listed on the BSE on 10^th May at Rs.227 and look at the run it has had in less than two months of listing.

The company has priced its IPO at the upper band at Rs.210 and the IPO was subscribed 40.68 times.

Bengaluru based Ujjivan Financial is a microfinance company serving over 27.7 lakh customers, through its 470 branches pan India, enjoying a market share of 11.15% of India’s NBFC-MFI business. Having received an in-principle approval from RBI to set up a small finance bank (SFB), foreign shareholding in the company is to be brought down to 49% or less, by April 6, 2017, and hence existing foreign investors pruned their holding to ~44%, from 77.10%, via the concluded IPO.

In our New Issue Analysis, we had said, “Ujjivan IPO is attractively valued and investment is advised for listing gains, as also, with a MT view, due to its robust operating performance, professional management, good corporate governance and favourable industry dynamics. Go for it!”