NE BUSINESS BUREAU
CHENNAI, MAY 7
Veritas Finance Limited, a retail-focused non-deposit taking NBFC, on Tuesday announced that it has received final observation from the capital markets regulator, Securities and Exchange Board of India (SEBI) for its proposed IPO.
- The NBFC company gets SEBI observation for a Rs 2,800 crore IPO with a Rs 600 crore fresh issue and an offer for sale of Rs 2,200 crore
- The company’s net profit increases 20.47 per cent YoY to Rs 295.11 crore
- Veritas focuses its strategy on serving MSMEs and self-employed individuals, with average loan ticket sizes of ₹5 lakhs as of September 30, 2024
The public offer comprises a fresh issue of Rs. 600 crore and an offer for sale of Rs. 2,200 crore with face value of ₹10 per equity share. The IPO also includes a reservation of shares for eligible employees
Veritas Finance Limited proposes to utilize the net proceeds towards augmenting the capital base to meet future business requirements of the Company towards onward lending.
Established in 2015, Veritas Finance Limited focuses on addressing the financial needs of underserved and underbanked MSMEs and individuals by providing access to credit. They offer a range of products, including small business loans, housing loans, used commercial vehicle loans, and working capital loans.
Veritas is the fastest-growing NBFC in terms of AUM growth among compared peers for the period between the Financial Years 2022 to 2024, with a compounded annual growth rate (CAGR) of 61.76%, as per a CRISIL MI&A report. Its MSME loan book, encompassing both rural and urban finance, has outpaced overall market growth, (CRISIL MI&A report). Veritas has focused its strategy on serving MSMEs and self-employed individuals, with average loan ticket sizes of ₹5 lakhs as of September 30, 2024. This segment remains a key growth driver, especially in underserved markets.
As of September 2024, the average loan ticket size was noted to be ₹5 lakhs, indicating its commitment to small-scale lending, which remains a key growth area. This approach has allowed Veritas to significantly outpace market growth in its MSME loan book, covering both rural and urban sectors.
Veritas Finance reported its audited financial results for FY25, where its total income increased 39.5 per cent YoY to Rs 1,550.67 crore, while its net profit increased 20.47 per cent YoY to Rs 295.11 crore. The company saw a 19.47 per cent YoY rise in net worth at Rs 2,783.17 crore for the year reported.
ICICI Securities Limited, HDFC Bank Limited, Jefferies India Private Limited, Kotak Mahindra Capital Company Limited and Nuvama Wealth Management Limited are the Book Running Lead Managers to the issue.
