IIFL Holdings attracts buyers after subsidiary acquires microfinance firm

IIFL Holdings rose 0.7% to Rs 253.30 at 13:45 IST on BSE after the company said that its subsidiary proposes to acquire the management and control of Bangalore-based Samasta Microfinance.

The announcement was made after market hours yesterday, 17 November 2016.

Meanwhile, the BSE Sensex was up 33.79 points, or 0.13%, to 26,261.41.

On BSE, so far 5,462 shares were traded in the counter, compared with average daily volume of 35,847 shares in the past one quarter. The stock hit a high of Rs 256 and a low of Rs 247.95 so far during the day. The stock hit a 52-week high of Rs 339.50 on 28 October 2016. The stock hit a 52-week low of Rs 163.50 on 29 February 2016. The stock underperformed the market over the past one month till 17 November 2016, sliding 6.54% compared with 4.73% decline in the Sensex. The scrip also underperformed the market in past one quarter, falling 13.5% as against Sensex's 6.35% decline.

The mid-cap company has equity capital of Rs 63.42 crore. Face value per share is Rs 2.

IIFL Holdings said that its non-banking financial company (NBFC) subsidiary, India Infoline Finance (IIFL), proposes to acquire the management and control of Bangalore-based Samasta Microfinance (Samasta), through acquisition of upto 100% equity shares, subject to completion of necessary due diligence, regulatory and other internal approvals. Samasta is an NBFC-micro finance institution (NBFC-MFI) registered with the Reserve Bank of India (RBI). Pursuant to this, IIFL, Samasta and the promoters of Samasta will enter into necessary agreements and documents to effect sale and purchase shares of Samasta in due course upon completion of due diligence, internal approvals and regulatory process.

Samasta promoted by Narayanswamy Venkatesh and Deviah Shivaprasad, first generation entrepreneurs, began operations as an MFI in March 2008 and operates in Tamil Nadu, Karnataka, Maharashtra and Goa through 64 branches. It currently has an asset under management (AUM) of about Rs 100 crore as on 30 September 2016. The income of Samasta as on 31 March 2016 was Rs 20.14 crore. The proposed acquisition of Samasta will help IIFL to enter into micro finance segment and extend its wide ranging financial services to their large customer base. IIFL has received an in principle approval from the RBI for acquiring the stake. The indicative time for completion of the acquistion is about 6 months.

IIFL Holdings' consolidated net profit rose 30.4% to Rs 183.12 crore on 25.4% increase in net sales to Rs 1216.12 crore in Q2 September 2016 over Q2 September 2015.

IIFL Holdings is the apex holding company of the entire IIFL Group. It offers a gamut of services including financing, wealth and asset management, broking, financial product distribution, investment banking, institutional equities, realty and property advisory services through its various subsidiaries.

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