Chennai-Based Veritas Finance Taps Bankers For Rs 2,000-Crore IPO: Report

Chennai-based non-banking financial company Veritas Finance Pvt. Ltd is set to raise funds via the public market as it engages in discussions with various firms to determine share issuances. 

Veritas focuses on the large and underserved MSME financing market across semi-urban and rural geographies. Started in Tamil Nadu, the company has now expanded across eight states and one Union Territory, with 285 branches and servicing 115,000 customers, holding an AUM of Rs 3,500 crore as of March 31, 2023, according to information available in the media. 

The NBFC provides secured small business loans with an average ticket size of Rs 5 lakh.

After raising Rs1,200 crore in the equity funding last year, the NBFC has appointed Kotak Mahindra Capital Co., Jefferies, HDFC Ltd and ICICI Securities to discuss its IPO plans, news platform Mint reported.

Avendus Future Leaders Fund, Kedaara Capital, Norwest Venture Partners, British International Investment, and Lok Capital are the backers of Chennai-based NBFC.

The report further added quoting its sources that the company may raise funding ahead of the IPO.

As of September 30, of last year the NBFC claims a net worth of Rs 2183. With over 300 branches across 10 states and the Union Territory of Puducherry, including Tamil Nadu, Andhra Pradesh, Bihar, and Jharkhand, Veritas has established a significant presence. It competes with major players such as Shriram Finance, Bajaj Finserv, Equitas Small Finance Bank, and Lendingkart, among others.

The company’s gross loan portfolio increased to Rs 4,483 crore from Rs 3,534 crore by March 31, 2023. Over the six months ending on September 30th, the company generated a revenue of Rs 492.65 crore and a profit after tax of Rs 102.93 crore.

Despite its robust performance, Veritas faced a gross non-performing asset rate of 2.09 per cent and a net NPA rate of 1.1 per cent, the Mint report added citing the Icra report.