InvestorQ : Has Arohan Financial decided not to go ahead with its IPO plans for now?
Anamika Sodhani made post

Has Arohan Financial decided not to go ahead with its IPO plans for now?

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Angel dcosta answered.
4 weeks ago
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Arohan Financial Services, a microfinance company, just saw the expiry of its 1 year SEBI approval for the IPO. However, Arohan has decided to put off IPO plans for the time being and instead raise the required funds from the private equity space. Instead of the proposed Rs1,900 crore IPO, Arohan will now settle for a much smaller amount via the PE route. Being a microfinance company, it requires a steady flow of capital to keep its capital buffers intact. It expects pricing deregulation and credit harmonization to reflect on MFI performance.

The validity of the IPO approval granted by SEBI has ended in the last week of April 2022. Initially, Arohan was planning to refile for a public issue, but choppy equity markets and soaring inflation combined with monetary tightness and an overall inertness in the IPO market have change the mind of the issuer. There has been a recovery in the microfinance MFI market in India, although stressed loans still remain high. To add to that the MFI borrowing community is price elastic and also vulnerable to market shocks.
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