CreditAccess Grameen Limited (GrameenKoota) IPO Details & Analysis

Company Overview

Incorporated in 1991, CreditAccess Grameen Limited is a leading Indian micro-finance institution headquartered in Bangalore, focused on providing micro-loans to women customers predominantly in Rural Areas in India. According to CRISIL Research, CreditAccess Grameen Limited were the third largest NBFC-MFI in India in terms of gross loan portfolio as of 2017.

Operating mostly in Karnataka and Maharashtra, the GrameenKoota provides microfinance loans includes various categories from pure-play income-generation loans to additional loan categories such as family welfare, home improvement, emergency loans, individual retail finance and two-wheeler loans.

company website:

IPO Issue Details

IPO Issue Open: Aug 8, 2018 – Aug 10, 2018
IPO Issue Size:  1,131.19 Cr
IPO Issue Price:  418 – 422 Per Equity Share
Market Lot: 35 Shares
Minimum Order Quantity: 35 Shares
Listing At: BSE, NSE

IPO Tentative Schedule Dates
IPO offer date – 8 Aug to 10 Aug
IPO allotment and refunds: On or about Aug 20, 2018
CThe credit of Equity Shares to demat accounts: On or about Aug 21, 2018
Listing of IPO on Stock Exchanges: On or about Aug 23, 2018

Company Promoters
CreditAccess Asia N.V. (“CAA”) holds equivalent to 98.88% of Share capital of the Company.

Objective of the Issue
The Offer comprises of the Fresh Issue of 630Cr and the Offer for Sale.

CreditAccess Grameen IPO subscription status

Day 1, Aug 8 0.69x 0.01x 0.11x 0.25x
Day 2, Aug 9 0.79x 0.02x 0.28x 0.37x
Day 3, Aug 10 5.52x 0.98x 0.87x 2.22x


CreditAccess Grameen IPO Registrar
Karvey Computershare pvt. ltd.

CreditAccess Grameen Limited IPO Analysis

Business Operations
The Company has a customer-centric business model and loans are provided primarily under the joint liability group (“JLG”) model. Income generation loans comprise 87.02% the total JLG loan portfolio. As of 2018, the company operates through 516 branches mostly in Karnataka (58.08%) and Maharashtra (26.73%).

The gross AUM was Rs 49,746.61 million as of March 31, 2018 and Gross AUM grew at a CAGR of 57.45% from 2014 to 2018. NBFC-MFIs have grown the fastest in the MFI industry. NBFC-MFIs account for close to 20%. CRISIL Research expects MFI loan portfolio growth to be at around 16-18% annually, in the next two years. The GLP of MFIs grew at 51% CAGR from the fiscal year 2012-13 to the fiscal year 2016-17.


MFI Industry growth
MFI Industry growth



  • 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

Financial Performance

Figures are in Million Rs.
  2018 2017 2016 2015 2014
Gross AUM 49,746.61 30,754.43 25,387.76 14,470.65 8,095.22
Gross AUM Growth (%) 61.75 21.14 75.44 78.76 54.52
Total revenue 8,752.05 7,092.61 4,667.19 2,814.28 1,478.29
Net Interest Margin 12.70% 13.72% 12.48% 12.33% 10.51%
Profit after tax 1,246.41 802.98 832.41 487.32 166.26
Cumulative Repayment Rate 96.62% 96.54% 99.94% 99.96% 99.99%
Gross NPA Ratio 1.97% 0.08% 0.08 % 0.04% 0.01%
Net NPA Ratio 0% 0% 0% 0% 0%
Credit Rating A (positive) A A A- BBB+
EPS diluted 12.11 9.88 11.23 9.01 4.18
Return on Net Worth (RoNW) 8.73% 11.63% 18.13%
Active Customer Retention Rate 90% 86% 86% 86% 82%


Peer Comparison

AUM Figure in Cr
Company AUM ROE (3 year


Bharat Financial 13.832 20.1% 0.1% 18x
CreditAccess Grameen 4.975 16.1% 0.0% 35x
Satin Creditcare 5.757 12.6% 2.6% 80x
Ujjivan Financial 7.787 15.4% 0.3% 21x
Equitas Holdings 8.926 15.5% 1.5% 35x



  • 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 a 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
    • NBFC-MFI CAGR 2018-2020

Analysis Conclusion

NOTE: GET such ‘Genuine IPO Analysis‘ Email Notifications directly to your Email Inbox by just JOINING IN BOTTOM EMAIL LIST.

Join us:
Youtube: “BullRun India“ .

Looking at significant growth opportunities to the company due to the surplus fund from the 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 the issue price, there is a very little gain left on listing. So my say is ‘NEUTRAL’ for listing gain (-5 to +5%) 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.

AUM – Assets under Management
JLG – Joint Liability Group
GLP – Gross Loan Portfolio
NPA – Non-performing Assets
NBFC – Non-Banking Financial Company
MFI – Micro Finance Institutions
CAGR – Compound annual growth rate
EPS – Earning per share
P/E – Price to Earning
RoE – Return on Equity
QIB – Qualified Institutional Buyer
NII – Non-Institutional Investors
RII – Retail Individual Investor

Discussion forum - Initiate a discussion/Leave a reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s