According to market sources, the company plans to hit the market in the first half of the 2019.
By that time market conditions would be conducive to raise around Rs 1,000 crore from the IPO, sources said.
The proceeds will be utilised for expansion of the company's footprints in Northern India, sources said.
Muthoot Microfin, part of the Muthoot Pappachan Group, IPO comprises fresh issue aggregating up to Rs 500 crore and an offer for sale of up to 16,310,072 equity shares, as per the company's DRHP.
Muthoot Microfin is focussed on providing micro loans to women customers predominantly in rural areas.
This will be fourth pure play microfinance company to be listed on the bourses after Bharat Financial Inclusion, Satin Creditcare and Credit Access Grameen.
Muthoot Microfin had in July filed draft red herring prospectus (DRHP) for an initial public offering with the capital markets regulator Securities and Exchange Board of India (Sebi).