Gurugram-based NBFC Aye Finance Files DRHP With SEBI For Rs 1,450 Cr IPO

In order to raise Rs 1,450 crore through an initial public offering (IPO), Aye Finance Limited, a non-banking financial company - middle layer (NBFC-ML) located in Gurugram, has submitted its draft red herring prospectus (DRHP) to the Securities and Exchange Board of India (SEBI), the market regulator. A fresh issue of up to Rs 885 crore and an offer of sale (OFS) of up to Rs 565 crore by corporate and individual selling shareholders are put together in the initial public offering (IPO), which has a face value of Rs 2 per equity share.

Among the equity shares available for sale in the OFS segment are those from LGT Capital Invest Mauritius PCC with Cell E/VP for up to Rs 150 crore, CapitalG LP for up to Rs 130 crore, A91 Emerging Fund I LLP for up to Rs 100 crore, Alpha Wave India I LP for up to Rs 100 crore, MAJ Invest Financial Inclusion Fund II K/S for up to Rs 56.04 crore, CapitalG International LLC for up to Rs 6.8 crore, Harleen Kaur Jetley for up to Rs 14.5 crore, and Vikram Jetley for up to Rs 7.66 crore.

In order to satisfy the company's future capital needs resulting from the expansion of its assets and operations, as well as for general corporate objectives, the proceeds from the fresh issue will be utilised to broaden its capital base. The company may think about issuing more designated securities totalling up to Rs 177 crore after consulting with the primary managers in charge of the book-running process.

A minimum of 75% of the offer will be proportionately available for allocation to qualified institutional buyers through the book-building process. Additionally, a minimum of 15% of the net issue will be available for allocation to non-institutional bidders, and no more than 10% will be available for allocation to retail individual investors. The issue's registrar is KFin Technologies Limited, while the book-running lead managers are Axis Capital Limited, IIFL Capital Services Limited, JM Financial Limited, and Nuvama Wealth Management Limited.

With one of the lowest Net NPAs of 0.9% among peer NBFCs and the highest provision coverage ratio of 72%, Aye Finance maintained outstanding operational performance as of Fiscal 2024. Profitability has also increased dramatically, with Profit After Tax (PAT) increasing from Rs 43.9 crore in Fiscal 2023 to Rs 171.7 crore in Fiscal 2024, a startling 291.5% growth. With a debt-to-equity ratio of 2.8 and a Return on Equity (ROE) of 17.2%, Aye further solidified its financial status.

Leading Non-Banking Financial Company (NBFC) Aye Finance offers business loans to India's micro-scale businesses through its vast network of 478 offices in 18 states and 3 Union Territories. Aye Finance provides services to more than 5 lakh unique active customers. As of September 30, 2024, the corporation's assets under management (AUM) were Rs 4,980 crore, with an AUM growth of 64% year over year in Fiscal 2024 compared to Fiscal 2023.