Aye Finance Announces Rs 1,450 Crore IPO to Strengthen Market Presence
Aye Finance Limited, a leading SME-focused non-banking financial company (NBFC), is all set to raise Rs 1,450 crore through an Initial Public Offering (IPO). The company’s board approved the IPO plans during an Extra-Ordinary General Meeting (EGM) on December 11, 2024.
Breakdown of the IPO
The proposed IPO comprises:
A fresh issue of equity shares worth up to Rs 885 crore.
An Offer for Sale (OFS) of equity shares amounting to Rs 565 crore.
The IPO aims to bolster Aye Finance’s financial position and fund its operational expansion in India’s competitive lending market.
Strengthening Employee Incentives
In addition to the IPO, the EGM approved key amendments to the company’s Employee Stock Option Plans (ESOPs) for 2016, 2020, and 2024. These changes aim to enhance employee benefits and align the workforce with the company’s long-term growth strategy.
The EGM also introduced changes in the management structure. Sanjay Sharma was appointed as Managing Director, while Aditya Misra, representing ABC Impact, assumed the role of Non-Executive Non-Independent Director.
Leadership Changes
The meeting saw the resignation of five non-executive and non-independent directors, including representatives from prominent investors such as Elevation Capital, Alpha Wave, and A91 Emerging Fund. These resignations align with common practices for private companies preparing to go public.
Aye Finance’s Growth Story
Loan Book: Closed FY24 with a loan book of Rs 4,473 crore, up from Rs 3,200 crore in FY23.
Profit Growth: Reported a net profit of Rs 161 crore in FY24, a significant rise from Rs 57 crore in FY23.
Focus Area: Specializes in unsecured working capital loans, primarily catering to small and medium enterprises (SMEs).
Key Shareholders
Major stakeholders in Aye Finance as of September 2023 include:
Elevation Capital: 19.86%
LGT Capital: 17.38%
Capital G: 16.43%
Alpha Wave (Falcon Edge): 13.32%
A91 Emerging Fund: 10.32%
MAJ Invest: 7.11%
Promoter Sanjay Sharma: 3.16%
Recent Funding Success
In September 2024, Aye Finance raised Rs 250 crore in a Series G funding round led by ABC Impact, with participation from British International Investment. This followed a $30 million debt financing round in June, bringing the company’s total equity fundraising to Rs 1,500 crore.
IPO Lead Managers
Axis Capital, JM Financial, Nuvama, and IIFL Securities have been appointed as merchant bankers to manage the IPO.
Future Outlook
With this IPO, Aye Finance plans to solidify its market presence, expand its operations, and enhance its product offerings. Its focus on SMEs and robust financial performance make it a promising player in the NBFC sector.
For more insights and updates on the financial markets, visit TradingThought.com.
—
Keywords: Aye Finance IPO, SME lending, non-banking financial company, IPO in India, unsecured loans, financial growth, stock market news