1. At a Glance
A ₹254.26 Cr IPO where Laxmi India Finance wants you to fund their growth party. Out of this, ₹165.17 Cr is fresh money, and ₹89.09 Cr is promoters cashing out. Price band ₹150–₹158, minimum bid ₹14,100. Retail gets 35%, HNIs 15%, QIBs 50%. Listing on BSE/NSE on August 5, 2025.
2. Introduction with Hook
Imagine your neighborhood NBFC that gives tractor loans suddenly deciding to play in the big league. That’s Laxmi India Finance. They lend to MSMEs and vehicles in semi-urban Rajasthan and now want to raise ₹254 Cr so they can lend even more. Revenue grew 42% YoY, PAT jumped 60%, and management thinks investors will lap up the IPO like free chai.
3. Business Model (WTF Do They Even Do?)
They’re an NBFC with three main products:
- MSME Finance: Loans against property, 65% LTV, 7-year tenure, for small biz heroes.
- Vehicle Finance: For two-wheelers, tractors, and commercial vehicles.
- Construction Loans: For renovations/construction with steep interest rates (18–28%).
Essentially, they lend where banks fear to tread, charge high interest, and take collateral. Nice.
4. Financials Overview
- Revenue FY25: ₹248.04 Cr (vs ₹175.02 Cr FY24)
- PAT FY25: ₹36.01 Cr (vs ₹22.47 Cr)
- Assets: ₹1,412 Cr; Borrowings: ₹1,137 Cr
- ROE: 13.9%; EBITDA Margin: 66%
Verdict: Strong growth but debt pile is as high as their ambitions (D/E 4.4x).
5. Valuation
- Market Cap: ₹825 Cr
- P/E: 22.9x (post-issue)
- P/B: 2.57x
Peers like MAS Financial and Five-Star Finance trade around P/E 20x with much bigger scale. Translation: you’re paying premium price for a small-town lender.
6. What-If Scenarios
- Bull Case: They expand branches, collections stay strong, and margins stay juicy → stock rerates.
- Bear Case: Credit risk spikes, bad loans pile, and capital adequacy dips → stock tanks.
- Base Case: Moderate growth, limited rerating, investors yawn after listing pop.
7. What’s Cooking (SWOT Analysis)
Strengths:
- Focused MSME niche, high yields
- Deep Rajasthan penetration (158 branches)
- Robust underwriting
Weaknesses:
- High leverage, small size
- Geographical concentration
Opportunities:
- Expand to new states
- Tap underserved borrowers
Threats:
- Defaults, RBI regulations, liquidity shocks
8. Balance Sheet 💰
| FY25 | FY24 |
|---|---|
| Assets ₹1,412 Cr | ₹985 Cr |
| Net Worth ₹257 Cr | ₹201 Cr |
| Borrowings ₹1,137 Cr | ₹767 Cr |
| Debt is rising faster than their branch openings. |
9. Cash Flow (FY23–FY25)
| Year | Operating | Investing | Financing |
|---|---|---|---|
| FY25 | Strong inflows | Negative (lending expansion) | Positive (borrowings) |
| Cash flow looks like a freelancer’s bank account – busy but not always rich. |
10. Ratios – Sexy or Stressy?
| Ratio | FY25 |
|---|---|
| ROE | 13.9% |
| ROCE | ~12% |
| PAT Margin | 14.5% |
| D/E | 4.4 |
| Verdict: ROE decent, leverage scary. |
11. P&L Breakdown
| Year | Revenue | EBITDA | PAT |
|---|---|---|---|
| FY23 | ₹131 Cr | ₹86 Cr | ₹16 Cr |
| FY24 | ₹175 Cr | ₹115 Cr | ₹22 Cr |
| FY25 | ₹248 Cr | ₹164 Cr | ₹36 Cr |
| Topline running, bottom line jogging. |
12. Peer Comparison
| Company | Revenue (₹ Cr) | P/E | ROE |
|---|---|---|---|
| Laxmi India Finance | 248 | 22.9x | 14% |
| MAS Financial | 1,000+ | 20x | 17% |
| Five Star Business | 1,300+ | 20x | 15% |
| Peer verdict: The smallest guest at a party of finance giants, but charging cover fee like the host. |
13. EduInvesting Verdict™
Laxmi India Finance IPO is a high-risk, high-hype NBFC play. Growth is sizzling, but so is the valuation. Grey market hints at a listing pop, but long-term investors should worry about leverage and concentration.
Conclusion: A decent pit stop for IPO flippers, but don’t expect business class legroom.
Written by EduInvesting Team | 27 July 2025
Tags: Laxmi India Finance, NBFC IPO, MSME Lending, ₹254 Cr IPO, EduInvesting Premium
