Laxmi India Finance is a non-deposit taking NBFC (Non-Banking Financial Company) that caters to the underserved financial segment across various regions in India. With an operational presence across 139 branches in Rajasthan, Gujarat, Madhya Pradesh, and Chhattisgarh, it offers a broad range of loan products including MSME loans, vehicle loans, and construction loans.

The company is tapping into the capital market with a Book Built Issue worth ₹254.26 Crores, comprising a Fresh Issue of ₹165.17 Crores (104.53 lakh shares) and an Offer for Sale of ₹89.09 Crores (56.38 lakh shares). The IPO was open for subscription between July 29, 2025 and July 31, 2025, with an expected listing on August 05, 2025, on the BSE and NSE. The price band for the IPO was fixed at ₹150 to ₹158 per equity share, with a lot size of 94 shares.

Subscription Status and GMP Trends

By 7:00 PM on July 31, the IPO was subscribed 0.75 times, reflecting a lukewarm response from the broader investor base. Despite this, the Grey Market Premium (GMP) for the IPO stood at ₹13, pointing toward a potential listing premium of around 8.22%. However, GMP is unofficial, influenced by unorganised trading, and not recommended for making investment decisions.

Anchor Investment Details

Laxmi India Finance successfully raised ₹75.51 Crores from anchor investors by allocating 47,79,379 equity shares at the upper price band of ₹158. These investments came after consultation with the Book Running Lead Manager, PL Capital Markets Private Limited. Anchor investments typically represent strong institutional confidence and may influence the IPO sentiment positively.

Financial Performance Overview

The company has shown a consistent financial growth trajectory. Key figures include:

• Revenue from operations:

  • FY25: ₹2,480.38 Million

  • FY24: ₹1,750.18 Million

  • FY23: ₹1,306.68 Million

• EBITDA:

  • FY25: ₹1,638.83 Million

  • FY24: ₹1,145.86 Million

  • FY23: ₹859.56 Million

• Profit After Tax (PAT):

  • FY25: ₹360.05 Million

  • FY24: ₹224.68 Million

  • FY23: ₹159.71 Million

This upward trend demonstrates the company’s expanding reach and solid financials in its niche lending sector.

Valuation Metrics

The IPO has been priced moderately compared to peers. Key valuation indicators include:

• Pre-issue EPS (FY24): ₹8.78

• Post-issue EPS: ₹6.89

• Pre-issue P/E ratio: 17.99x

• Post-issue P/E ratio: 22.94x

• Industry average P/E: 82x

• ROE (FY24): 15.66%

• RoNW: 15.66%

The valuation appears fair and provides room for upward movement, especially given the industry benchmarks.

IPO Objectives

The Net Proceeds from the IPO will primarily be utilised for:

1. Augmenting the capital base to support future lending operations, with ₹1,770 Million earmarked for onward lending activities.

2. Strengthening financial capacity to expand into new geographical areas and customer segments.

Company Management and Governance

The company is spearheaded by Promoter Deepak Baid, who brings over 20 years of experience in the financial services space. He is supported by a dedicated and experienced management team alongside a panel of independent directors, ensuring strong corporate governance. The company also benefits from tight risk management frameworks and robust credit underwriting practices.

IPO Listing Expectations and Risk Assessment

While the GMP hints at a modest listing gain, it is important to factor in the low subscription rate of 0.75 times. This can lead to uncertainty in listing performance. That said, the strong anchor book participation and financial growth do provide underlying support to investor confidence.

The market capitalisation at IPO price stands at ₹825.83 Crores. Retail investors can apply with a minimum investment of ₹14,852 (94 shares), while HNIs need to invest in at least 14 lots (1,316 shares) worth ₹2,07,928.

IPO Registrar and Allotment Process

The IPO allotment will be handled by MUFG Intime India Private Limited. Investors can check their allotment status online starting from August 01, 2025. The steps to check include:

1. Go to the IPO allotment status page

2. Select Laxmi India Finance Limited from the dropdown

3. Enter your application number, PAN, or DP Client ID

4. Submit the details to view the status

Final Recommendation

Despite a lower-than-expected subscription, Laxmi India Finance’s strong fundamentals, healthy ROE, and promoter background make it a promising listing candidate. With a GMP of ₹13 and industry P/E at 82x, there’s room for moderate listing gains.

Verdict:
We recommend risk-tolerant investors to apply for potential listing gains, while long-term investors should wait for post-listing performance to assess further entry.

Disclaimer
This article is for educational and informational purposes only and does not constitute financial advice. Investment decisions should be based on individual risk tolerance and consultation with SEBI-registered advisors. Market conditions are volatile and subject to change. Neither the author nor the platform is responsible for losses arising from use of this information.

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