Mangalam Industrial Finance RI - Oct 25 review - (Not Rated)

•    This is the 2nd RI from the company since January 2024.
•    The RI is at a discount of around 39% based on its last traded price of Rs. 1.63 as of October 24, 2025.
•    The company has posted minuscule financial performances for the reported periods.
•    Based on its recent financial data, the issue appears fully priced.
•    Post-RI paid-up capital of Rs. 144+ cr. may post its servicing issue.
•    Well-informed/cash surplus/risk seekers may park moderate funds for long term.

ABOUT COMPANY:
Mangalam Industrial Finance Ltd. (MIFL) was incorporated in the year 1983 and after completing 41 years, it continued to provide competitive and tailor-made financial services. It is one of the Non-Banking Finance Companies based out in Kolkata and Gujarat, and strives to deliver best to meet customers’ financial needs.

At MIFL, the atmosphere is characterized by focus and drive, as everyone collaboratively strives for excellence to pursue their goals. The Company has a workforce championing this spirit of MIFL in day-to-day activities. The business model is based on client relationships that are established over period of time rather than a project- based execution approach. The Company believes that long-term client relationship fetches better dividends. Long-term relations are built on trust and continuous satisfaction of the customers. It helps understanding the basic approach of the Company, its products and its market. It also forms the basis of further expansion for it, as the company is able to monitor a potential product/ market closely. As the Company has been granted NBFC License by RBI, the Company’s business model is mainly centered on Loan activities i.e., financing the two wheelers electric vehicle and granting of unsecured loans to body corporates and individuals.

The digital lending in India has sharply risen, especially during the COVID-19 pandemic. Banks and NBFCs are increasingly lending either directly through their own digital platforms or through a digital lending platform under an outsourcing arrangement. Its vision is anchored in a digitally advanced India, where financial solutions are effortless and swift for everyone. MIFL’s commitment is to provide own digital platforms for paperless, simplified disbursement process, speedy loan approval, hassle-free and customized finance solutions is paralleled by its dedication to social responsibility, amplifying positive change within society.

The Company has adopted an integrated approach to lending, with the technology infrastructure and related back-end support functions similar to that of a retail bank. This integrated approach has enabled it to manage increasing business volumes and optimize overall efficiencies. Its focus to provide financial facilities such as vehicle financing, working capital loans, personal loans, housing loans, etc. As of June 30, 2025, it had just 10 employees on its payroll.

ISSUE DETAILS:
The company is coming out with its Rights Issue (RI) of 480821750 equity shares of Re. 1 each at par value to mobilize Rs. 48.08 cr. The RI opens for subscription on October 27, 2025, and will close on November 07, 2025. The company is offering RI in the ratio of 1 for 2 to its eligible stakeholders as of the record date of September 23, 2025. The company is asking for full money on application for the number of shares applied. Post allotment, RI shares will be listed on BSE. The company is spending Rs. 1.00 cr. for this RI process, and from the net proceeds, it will utilize Rs. 43.08 cr. for augmenting capital base, and Rs. 4.00 cr. for general corporate purposes. This is the 2nd RI from the company since January 2024.

The RI is self-managed by the company itself, and Purva Sharegistry (India) Pvt. Ltd. is the registrar to the issue. 

Post-RI, company’s current paid-up equity capital of Rs. 96.16 cr. will stand enhanced to Rs. 144.25 cr. Based on the RI pricing, the company is looking for a market cap of Rs. 144.25 cr. 

FINANCIAL PERFORMANCE:
On the financial performance front, for the last three fiscals, the company has posted total income / net profit/ - (loss), of Rs. 1.33 cr. / Rs. – (5.01) cr. (FY23), Rs. 2.62 cr. / Rs. 0.19 cr. (FY24), and Rs. 3.56 cr. / Rs. 1.23 cr. (FY25). For Q1 of FY26 ended on June 30, 2025, it earned a net profit of Rs. 0.34 cr. on a total income of Rs. 0.91 cr. Thus, while it posted minuscule financial performance for the reported periods, it marked dicey earnings.  Its NAV stood a Rs. 0.31 per share as on June 30, 2025.

DIVIDEND POLICY:
The company has paid a dividend of 1% in January 2025. It will adopt a prudent dividend policy, based on its financial performance and future prospects. However, offer document is silent on its dividend policy.

SCRIP PERFORMANCE: BASED ON BSE WEBSITE DATA: SCRIP CODE: 537800 (FV Re. 1).
The scrip last closed on cum-right basis at Rs. 1.77 on September 22, 2025, and opened on an ex-right basis at Rs. 1.58 on September 23, 2025. Since then, it has marked a high/low of Rs. 1.82 / Rs. 1.45. The scrip last closed at Rs. 1.63 as of October 24, 2025. For the last 52 weeks’ it has posted a high/low of Rs. 3.85 / Rs. 1.26. The counter is currently under ASM LT: Stage 1.

The promoters’ holding has declined a bit to 58.41% as at quarter ended September 30, 2025 against 58.94% for quarter ended June 30, 3035, and 60.30% for quarter ended March 31, 2025. The counter is well maintained above the par value to tempt investors.