Thu Sep 26 00:55:10 UTC 2024: ## Northern Arc Capital Makes Strong Debut on Stock Market, Shares Surge 33% on Listing

**Mumbai, September 24, 2024** – Northern Arc Capital Ltd, a non-deposit taking NBFC focused on retail lending to underserved households and businesses in India, made a strong debut on the stock market today, with shares opening at ₹351 apiece on the BSE, a premium of 33.46% over its issue price of ₹263 per share. The IPO, which was oversubscribed 110.91 times, raised ₹777 crore for the company.

The strong demand from investors, particularly from Qualified Institutional Buyers (QIBs), who subscribed 240.79 times their allotted portion, propelled the share price higher.

However, despite the strong initial performance, the stock experienced some volatility during the day, falling as much as 11.1% from its listing price before settling at ₹323.60, down 7.81% on the BSE.

Analysts remain optimistic about the company’s long-term prospects, citing its strong sectoral focus on MSME, microfinance, and consumer finance, and its potential for growth in the underserved Indian market.

“Post listing, we continue to believe that investors should continue to HOLD because of an opportunity to hold a stake in a diversified financial services platform dedicated to addressing the retail credit needs of under-served households and businesses in India,” said Prashanth Tapse, Senior VP (Research), Mehta Equities Ltd. “Northern Arc Capital share is well-positioned for a sustained growth in the long term.”

Despite the initial decline, the stock closed above its IPO price, indicating investor confidence in the company’s future. The company’s strong performance in FY24, with revenue increasing by 45% to ₹1,906.03 crore and profit after tax (PAT) rising by 31% to ₹317.69, further supports this optimism.

However, some experts caution that investors should be mindful of the company’s high debt-to-equity ratio and the competitive landscape in the lending market.

Northern Arc Capital plans to use the fresh issue proceeds to meet future capital requirements for onward lending, further solidifying its position in the Indian financial services landscape.

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