Fusion Finance shares rise over 8% after Rs 800-cr rights issue success

Fusion Finance shares jumped as its Rs 800-crore rights issue saw 1.5x oversubscription, driven by strong backing from promoters and institutional investors

Shares of Fusion Finance jumped over 8 per cent after the Warburg Pincus-backed firm successfully concluded its Rs 800-crore rights offering.

 

The fully paid shares of Fusion Finance surged 8.4 per cent to end at Rs 165.5, while the partly paid shares rose 10 per cent to Rs 96.

 

The rights issue—the largest successfully concluded so far this calendar year—was oversubscribed 1.5 times. It saw strong participation from existing shareholders, including Honey Rose Investment (a Warburg Pincus affiliate) and Creation Investments Fusion.

 

As on 2 May, Honey Rose held about 35.2 per cent stake in the company, while Creation Investments held 16.83 per cent. Both are categorised as promoters. Among public shareholders, HDFC Mutual Fund and Nippon MF held 4.21 per cent and 3.97 per cent, respectively. 

 

The microfinance lender issued 61.1 million partially paid-up equity shares at Rs 131 each. Eligible shareholders could apply for 55 shares for every 91 held, paying 50 per cent (Rs 65.5 per share) upfront and the balance later. The proceeds will bolster Fusion Finance’s balance sheet, fuelling growth opportunities.

 

“The additional capital will reinforce our balance sheet, enabling us to capitalise on the emerging opportunities while continuing to deliver sustainable value to all stakeholders,” said Devesh Sachdev, Managing Director, Fusion Finance.

 

With close to 3.7 million clients, Fusion Finance provides financial services to underserved and unserved women entrepreneurs in rural areas. It has assets under management (AUM) of Rs 10,600 crore and a network of 1,506 branches spread across 22 states.

 

Investec, in a note in April, said the “worst seems to be over” for the Indian microfinance industry and that one can expect a gradual recovery and consolidation in this space. 

Aether Industries prices its offer for sale at ₹700/share 

Aether Industries has priced its offer for sale (OFS), which will begin on Tuesday at ₹700, a 15 per cent discount to its stock's closing price of ₹806 on Monday.  The company plans to issue 89 lakh shares worth ₹628.5 crore or 6.7 per cent of its total shares. The company has reserved 90 per cent of the OFS for the institutional and high-net-worth individuals and the remaining 10 per cent for retail investors.