Dar Credit and Capital Limited is a niche financial services company specializing in providing credit solutions to low-income individuals. Their primary focus is on class-four (Group D) employees such as cleaners, sweepers, and peons working in municipalities. Besides, the company extends credit to small-scale shopkeepers and vendors, with a particular emphasis on empowering women entrepreneurs.

IPO Details

The Dar Credit and Capital IPO is a fresh issue comprising 42.76 lakh equity shares totaling approximately ₹25.66 crore. The IPO opens for subscription on May 21, 2025, and closes on May 23, 2025.

The price band is fixed between ₹57 to ₹60 per equity share. The lot size is 2000 shares, requiring a minimum retail investment of ₹1,20,000. High Net Worth Individuals (HNIs) must apply for at least 2 lots (4000 shares) amounting to ₹2,40,000.

The IPO is managed by GYR Capital Advisors Private Limited as the Book Running Lead Manager. KFIN Technologies Limited is the registrar for the issue, while SMC Global Securities Limited acts as the Market Maker.

Allotment is expected around May 26, 2025, and listing on the NSE SME platform is tentatively scheduled for May 28, 2025.

Leadership

The company is led by Mr. Ramesh Kumar Vijay, who is the Promoter, Chairman, and Whole Time Director. Mr Vijay holds a Bachelor’s Degree in Commerce and is a Chartered Accountant as well as a qualified Company Secretary. With over 39 years of experience in personal loans and MSME lending, he is a founding member and a Patron Member of the B.B.D. Bag Professional Study Circle Association. His extensive expertise is a key asset for the company’s growth and governance.

Financial Performance

Dar Credit and Capital has shown steady growth in revenues and profits over recent years:

Revenue from Operations (₹ lakh):

• FY2022: 2,442.08

• FY2023: 2,556.97

• FY2024: 3,301.38

• 9 months ended Dec 31, 2024: 3,103.24

EBITDA (₹ lakh):

• FY2022: 1,603.09

• FY2023: 1,673.75

• FY2024: 2,203.86

• 9 months ended Dec 31, 2024: 2,158.06

Profit After Tax (₹ lakh):

• FY2022: 250.18

• FY2023: 293.00

• FY2024: 396.83

• 9 months ended Dec 31, 2024: 491.94

This growth reflects improved operational efficiency and expanding business reach in niche credit markets.

Valuation Metrics

At the upper price band of ₹60, valuation parameters are:

• Pre-issue EPS (FY24): ₹3.97

• Post-issue EPS (FY24): ₹2.78

• Annualised EPS (latest 9 months): ₹6.56

• Pre-issue P/E ratio: 15.11x

• Post-issue P/E ratio: 21.59x

• Industry P/E ratio: 6.00x

• ROCE (FY24): 9.22%

• ROE (FY24): 6.17%

• Return on Net Worth (FY24): 5.64%

These metrics indicate the IPO is fully priced, trading at a premium to the industry P/E, suggesting limited upside potential.

Grey Market Premium (GMP)

The Grey Market Premium for Dar Credit and Capital IPO currently stands at ₹5, implying an estimated listing gain of 8.33 percent based on the upper price band. However, GMP is an unofficial indicator and can fluctuate widely; it depends on unregulated demand and supply and is not a reliable predictor of listing gains.

Market Capitalisation

The company’s market capitalisation at the IPO price band of ₹60 per share is approximately ₹85.65 crore. This valuation places the company in the small-cap SME financial sector segment.

Investment Recommendation

Given the fully priced valuation relative to the industry, limited financial scale, and niche credit focus, investors are advised to avoid this IPO for listing gains. The company does demonstrate steady growth and strong leadership but lacks attractive valuation margins for short-term listing profits.

The Upcoming IPOs in this week and coming weeks are Aegis Vopak Terminals, Schloss Bangalore, Astonea Labs, Nikita Papers, Prostarm Info Systems, Victory Electric Vehicles International, Blue Water Logistics, Unified Data - Tech Solutions, Wagons Learning.

The Current active IPO are Dar Credit and Capital, Belrise Industries, Borana Weaves.