Veritas Finance Files for INR 2,800 Cr IPO, Aiming to Expand Lending Portfolio The IPO comprises a fresh issue of equity shares worth INR 600 crore and an offer for sale (OFS) of equity shares aggregating up to INR 2,200 crore by existing shareholders.
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Veritas Finance Limited, a retail-focused non-deposit taking Non-Banking Financial Company (NBFC) registered with the Reserve Bank of India (RBI), has filed its Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) for an Initial Public Offering (IPO) aggregating up to INR 2,800 crore.
Classified as an 'NBFC-Middle Layer' under the RBI's scale-based regulations, the company primarily caters to micro, small, and medium enterprises (MSMEs) and self-employed individuals.
The IPO comprises a fresh issue of equity shares worth INR 600 crore and an offer for sale (OFS) of equity shares aggregating up to INR 2,200 crore by existing shareholders.
Notable investors participating in the OFS include Norwest Venture Partners X – Mauritius (INR 550 crore), Kedaara Capital Fund II LLP (INR 550 crore), and British International Investment Plc (INR 500 crore). The OFS also includes contributions from Lok Capital Growth Fund, Growth Catalyst Partners LLC, and individual shareholders such as Vidya Arulmany and Savita S. Pai.
A portion of the equity shares will be reserved for subscription by eligible employees, referred to as the "Employee Reservation Portion." Veritas Finance plans to utilise the net proceeds from the fresh issue to bolster its capital base, enabling it to expand its lending operations and address future business requirements.
The company may also consider a pre-IPO placement of securities worth up to INR 120 crore. If executed, the pre-IPO placement amount will be deducted from the fresh issue size.
Established in 2015, Veritas Finance has built a diversified portfolio, offering small business loans, home loans, and used commercial vehicle loans. Its primary focus is to meet the financial needs of underserved and underbanked MSMEs and individuals. According to CRISIL MI&A, the company achieved a compound annual growth rate (CAGR) of 61.76% in loans (AUM) between FY 2022 and FY 2024, positioning it as the fastest-growing NBFC among its peers.
The IPO's Book Running Lead Managers (BRLMs) include ICICI Securities Limited, HDFC Bank Limited, Jefferies India Private Limited, Kotak Mahindra Capital Company Limited, and Nuvama Wealth Management Limited. The equity shares are proposed to be listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE).
With its IPO, Veritas Finance aims to solidify its position as a leading NBFC, further its commitment to supporting MSMEs, and enhance credit access across India.
