KOCHI: The Securities and Exchange Board of India (SEBI) has cleared Bain Capital’s proposed open offer to acquire an additional 26 per cent stake in Manappuram Finance, marking another major move by global private equity firms into India’s non-banking financial sector.
The open offer, priced at Rs236 per share, matches the rate at which Bain had earlier acquired an 18.6 per cent stake in the Kerala-based gold loan company through a block deal.
While SEBI’s approval marks a key regulatory milestone, the final go-ahead from the Reserve Bank of India (RBI) is still awaited.
According to a regulatory filing by Manappuram Finance, the letter of offer to shareholders will be dispatched once the RBI approval is received.
The deal is one of the most significant foreign investments in the Indian gold loan space in recent times, and industry watchers believe it could trigger wider interest in the sector.
Mid-sized gold loan firms in focus?
There is growing speculation that medium-sized gold loan companies may increasingly come under the radar of global investors, especially as formal credit penetration rises in semi-urban and rural areas.
Industry sources indicate that several foreign funds have begun early-stage evaluations of opportunities in this space, buoyed by high yields, strong asset quality, and relatively low competition compared with other lending verticals.
While major players like Muthoot Finance and Manappuram dominate the organised gold loan market, the broader sector remains fragmented, with numerous regional and mid-sized firms holding a significant share.
As the regulatory framework continues to evolve and the demand for short-term, asset-backed lending grows, these companies may emerge as potential acquisition or investment targets.
Bain Capital’s move could thus be seen not just as a one-off bet, but possibly the beginning of a larger trend where private equity and strategic investors look to tap into India’s collateral-backed lending ecosystem.
What’s next
Manappuram Finance, known for its strong footprint in South India, may benefit from Bain’s involvement in terms of capital infusion, governance, and long-term strategic direction. If the open offer is fully subscribed, Bain’s stake in the company would rise to 44.6 per cent, making it one of the largest shareholders.
The final outcome now hinges on the RBI’s nod, which will not only determine the immediate fate of the open offer but could also shape how regulators view growing foreign interest in India’s gold loan NBFCs.
