Laxmi India Finance IPO: A Fast Growing NBFC Player

29 Jul 2025 , 11:47 AM

Laxmi India Finance is a well-established Rajasthan-focused NBFC. It has witnessed strong AUM and profit growth in the past two years. Laxmi India Finance is raising INR 2542.6 million in an IPO. The IPO includes both a fresh issue and an offer for sale by promoters.

Offer Details of the IPO

·         Total Offer Size: Upto 16,092,195  Equity Shares aggregating upto INR 2,542.6 million

·         Fresh Issue: Upto 10,453,575 Equity Shares aggregating upto INR 1651.7 million

·         Offer for Sale: Upto 5,638,620 Equity Shares aggregating upto INR 890.9 million

·         Selling Shareholders:

1.     Deepak Baid (Promoter Selling Shareholder): Up to 3,084,952 Equity Shares

2.     Prem Devi Baid (Promoter Selling Shareholder): Up to 913,070 Equity Shares

3.     Aneesha Baid (Promoter Selling Shareholder) : Up to 1,261,902 Equity Shares

4.     Deepak Hitech Motors Private Limited (Promoter Selling Shareholder): Up to 180,000 Equity Shares

5.     Prem Dealers Private Limited (Promoter Selling Shareholder):  Up to 90,000 Equity Shares

6.     Preeti Chopra (Promoter Group Selling Shareholder): Up to 54,348 Equity Shares

7.     Rashmi Giria (Promoter Group Selling Shareholder) : Up to 54,348 Equity Shares

Price Band: Rs. 150/- to Rs. 158/- per Equity Share

BRLMs

• PL Capital Markets Private Limited
• MUFG Intime India Private Limited (formerly known as Link Intime India Private Limited)

Objectives of the IPO

The proceeds from the fresh offer are earmarked for strengthening the capital base of the company to support future capital requirements of onward lending.

NBFC Industry – Overview

NBFC sector forms a key part of the Indian financial system. It expands access to formal financial products to people who are unbanked or unable to access banking products or have a more convenient way of accessing financial products. NBFCs are non-bank finance companies that provide various banking services, such as loans, credit facilities, and investments. Typically, they do not accept bank deposits (like a commercial bank).

The sector has experienced robust growth and has grown in size due to the growing demand for financial services, government efforts and technological progress.

Key Segments within the Industry

Retail Finance: Retail finance is a large market for the NBFC industry, and it meets individual and household financial needs. This category includes personal loans, credit cards, home loans and consumer durables loans. Retail finance NBFCs concentrate on delivering financial products to those who are non-serviced or under-serviced by banks.

Microfinance: Microfinance is yet another major part of the NBFC sector that extends small credits to poor people and small firms. NBFC MFIs facilitate financial inclusion and access to credit for the millions at the bottom of the economic pyramid.

Commercial Finance: Commercial financing involves business loans and other forms of financing to business owners and companies. This portion of the products includes working capital loans, term loans, and invoice financing. Commercial finance NBFCs provide financial services to cater to the needs of business organisations that need money to expand, modernise and remove stagnation.

Infrastructure Finance: Infrastructure financing is a market that offers financial services to infrastructure projects, including roads, bridges and renewable energy projects. Infrastructure financial services NBFCs have a very important role to play in the development of infrastructure in India.

Housing Finance: Housing finance is one of the sectors that engages in financial services for housing and real estate development. Housing finance NBFCs provide loans for purchase, construction, extension and renovation of homes, while they also provide loans to developers for construction purposes.

Industry Size and Growth:

India continues to see robust credit growth. Including bank and non-bank credit, overall systemic credit in India was estimated at INR 236 trillion in FY25. Further, this is expected to witness a CAGR of 12%–13% between FY25-FY27. The share of NBFCs within retail credit has been growing. It has expanded from 17% in FY19 to ~19% in FY25.

Segment-wise Growth

• Retail and Industry account for the largest share of NBFC credit. Among these, Retail has witnessed a substantial increase.
• Over the past 5 years, the share of retail has increased from 30% to 36%.
• Credit to industries accounted for 37.6% as of FY25.

Key Drivers of Growth

·         Increasing credit demand: The demand for credit in India is on the rise for reasons like increasing consumer spending, higher levels of income, and greater availability of credit.

·         Government measures: The Government has taken various measures to boost growth in the NBFC segment, like the ECLGS and the CGTMSE.

·         Technological Upgrades: The integration of technology into their functioning has made NBFCs more efficient and broad-based in terms of their clientele, offering more innovative products.

·         Increasing Focus on Financial Inclusion: NBFCs have been pivotal in advancing financial inclusion in India, offering credit to people who would otherwise have been overlooked, such as MSMEs and low-income households.

Company Background – LIFL

Laxmi India Finance Limited (LIFL) is a non-deposit taking non-banking finance company (NBFC) offering an integrated and diversified range of financial products and services, with particular strength in catering to the funding requirements of the unmet segment of potential customers in unserved /underserved areas. The company was founded in 1996 and is based in Jaipur, Rajasthan. LIFL has a robust history of serving the underserved, both in rural and semi-urban markets.

LIFL has a history dating back to the 1990s. Deepak Finance & Leasing Company was set up by the promoter’s father as a proprietorship concern in 1992. The Promoter purchased shares and acquired control of LIFL in 2010, and subsequently consolidated the business and operations of DFL too.

LIFL is in partnership with several banks, financial institutions and private entities for carrying on various financial services. The Company has a wide network of branches and reach in rural and semi-urban areas, which serves the underbanked customers. It has one of the largest branch networks in Rajasthan.

Key Segments

LIFL is active in a range of businesses, including:

·         MSME Finance: The firm offers secured loans to micro, small, and medium enterprises (MSME) to meet their business requirements, growth needs and working capital.

·         Vehicle Finance: LIFL extends secured loans to customers for the procurement of used commercial vehicles, tractors, two wheelers and electric vehicles.

·         Construction Loans: The Company offers secured loans to retail customers to credit purchase residential property for construction, renovation or extension purposes.

·         Other Lending Products: LIFL also provides unsecured small-ticket loans to MSME and individual retail customers for their working capital requirements and personal use, respectively.

LIFL is a well-established NBFC with a strong rural and semi-urban presence. Its diverse range of products and services addresses the financial needs of underbanked consumers.

Competitive Landscape

NBFC is a highly competitive industry with many regional and national players.  Some of the major competitors are:

·         MAS Financial Services Limited: An established NBFC with a dominant footprint in Gujarat & Maharashtra, offering multiple financial products including: micro enterprise loans, salaried personal loans, 2-wheeler loans, etc.

·         Five Star Business Finance Limited: An NBFC based in Chennai, which is primarily engaged in catering to the requirements of Small Business and Micro Enterprise lending through its range of products, viz., mortgage loans, business loans and gold loans.

·         SBFC Finance Limited: An NBFC with a strong presence in Uttar Pradesh, offering secured MSME loans, loans against gold and other financial products.

·         UGRO Capital Limited: An AI and data-tech enabled lending platform with an extensive distribution network as well as a data-tech underwriting model to bridge the credit gap present in small businesses in India, providing secured business loans, machinery business loans and retailer financing products.

·         CSL Finance Limited: An NBFC providing retail loans, wholesale loans, and an emergency guarantee scheme (ECLGS) credit line.

·         AKME Fintrade (India) Limited: A diversified NBFC providing focused retail financing services to the lower-income and middle-income segments in India.

·         Moneyboxx Finance Limited: Non-deposit taking NBFC, providing small-ticket business loans to micro and small enterprises.

Strengths

• Wide reach in Rajasthan: It has the highest number of branches amongst its peers
• Robust risk management: low GNPA ratio and NNPA ratio

Weaknesses

• Heavy Reliance on MSME Loans: The company’s loan book is predominantly concentrated on MSME loans, constituting 76.34% of its total AUM.
• Limited Geographic Presence: While it has a wide reach in Rajasthan, the company operates in only 5 states in India. This limited geographical reach limits the company’s ability to increase its customer base and also results in regional concentration.
• High Average Cost of Borrowing: The company has a high average cost of borrowing, averaging 12.02% as of March 31, 2025.

Financial Profile

• Robust revenue growth: The company witnessed a strong revenue CAGR of more than 35% over the past two years. This was driven by a strong growth in AUM.
• High Profit Growth: PAT growth was also robust at more than 50% CAGR over the past. In addition to growing AUM, better spreads helped PAT growth.

Table 1: Key Financials

	Year Ending March 31,
Particulars	2023	2024	2025
Interest Income	1248.22	1647.85	2313.12
YoY		32.02%	40.37%
Total Revenue from Operations	1295.29	1731.37	2457.13
YoY		33.67%	41.92%
Profit for the Year	159.71	224.68	360.05
YoY		40.68%	60.25%

Source: RHP

 

Table 2: Financials and Valuation Comparison

Company Name	Total Income (INR m)	Profit After Tax (INR m)	Diluted EPS (INR)	NAV per Share (₹)	P/E	P/B	RoNW (%)
Laxmi India Finance Limited	2480.38	359.1	8.78	61.57	17.99	2.56	15.66
MAS Financial Services Limited	15204.5	3202.1	17.48	142.5	16.97	2.08	14.71
Five Star Business Finance Limited	28660.24	10695.88	36.5	214.13	20.62	3.52	18.6
SBFC Finance Limited	13067.46	3399.07	3.15	29.4	34.38	3.68	11.39
Ugro Capital Limited	14418.46	1512.25	14.71	222.57	11.65	0.77	8.68
CSL Finance Limited	2160.43	720.81	31.29	241.21	10.56	1.37	14.18
AKME Fintrade (India) Limited	1027.21	335.8	8.28	89.56	0.94	0.09	11.09
Moneyboxx Finance Limited	1992.27	11.35	0.39	79.85	476.67	2.33	0.53

Source: RHP

Table 3: KPI

KPI	Unit	Laxmi India Finance	MAS Financial Services	Five Star Business Finance	SBFC Finance	UGRO Capital	CSL Finance	AKME Fintrade	Moneyboxx Finance
Number of Branches	Count	158	204	748	205	235	43	29	163
Number of Employees	Count	1434	4200	11934	4294	NA	460	243	2000
AUM	INR. m	12,770	120,998	118,770	87,470	120,030	11,950	6,186	9,270
AUM Growth	%	32.83%	19.50%	23.19%	28.22%	32.67%	16.02%	53.23%	26.99%
Disbursements	INR. m	7185.34	NA	49697	NA	NA	11190	2537.8	5950
Disbursement Growth	%	36.75%	NA	1.81%	NA	NA	6.37%	161.49%	-10.53%
AUM per Branch	INR. m	80.82	593.13	158.78	426.68	510.77	277.91	213.31	56.87
AUM per Employee	INR. m	8.91	NA	9.95	20.37	NA	25.98	25.46	NA
Net Worth	INR. m	2575	25858	63046	31901	20464	5416	3822	2607
CRAR	%	20.80%	24.72%	50.10%	36.10%	19.14%	47.00%	57.58%	29.25%
Average Cost of Borrowing	%	12.02%	9.17%	9.38%	9.05%	10.86%	10.84%	14.69%	11.72%
Total Income	INR. m	2,480	15,205	28,660	13,067	14,418	2,160	1,027	1,992
Net Interest Income	INR. m	1,167	5,673	20,983	7,781	3,310	1,342	629	1,073
PAT after OCI	INR. m	359	3,202	10,696	3,399	1,512	721	336	11
Yield on Average Gross Loan	%	21.92%	16.24%	25.89%	17.95%	14.36%	19.39%	20.63%	29.19%
Spread	%	9.90%	7.07%	14.39%	8.42%	3.50%	8.56%	5.94%	17.47%
Net Interest Margin	%	9.73%	5.46%	16.07%	9.94%	4.29%	12.03%	11.31%	13.30%
Impairment to Total Average Asset	%	0.99%	1.21%	0.68%	0.94%	2.24%	1.07%	0.53%	3.49%
Return on Assets	%	3.00%	3.08%	8.19%	4.34%	1.96%	6.46%	6.04%	0.14%
RONW	%	15.66%	14.71%	18.60%	11.39%	8.68%	14.18%	11.09%	0.53%
GNPA	%	1.07%	2.44%	1.79%	2.74%	2.30%	0.46%	2.77%	6.61%
NPA	%	0.48%	1.62%	0.88%	1.51%	1.60%	0.34%	1.27%	3.42%
Disbursement per Branch per Month	INR. m	3.79	NA	5.54	NA	NA	21.69	7.29	3.04
Disbursement per Employee per Month	INR. m	0.42	NA	0.35	NA	NA	2.03	0.87	NA
PAT per Employee	INR. m	0.25	NA	0.9	0.79	NA	1.57	1.38	NA
PAT per Branch	INR. m	2.27	15.7	14.3	16.58	6.44	0.06	0.05	0
Net Asset Value (NAV)	INR.	61.57	142.5	214.13	29.4	222.57	241.21	89.56	79.85

Source: RHP