Avanse Financial Services Limited files DRHP with SEBI for an IPO

Avanse Financial Services Limited, an education focused non-banking financial company (“NBFC”) operating in India, has filed Draft Red Herring Prospectus (DRHP) with SEBI for an Initial Public Offering (IPO).

Avanse Financial Services is the second largest education focused NBFC in India by assets under management (“AUM”) as of March 31, 2024 (Source: CRISIL Report). It also have the second highest disbursements during the Financial Year 2023 and recorded the second highest profit after tax in Financial Year 2024 among education focused NBFCs in India. The company offer a full stack education offering with products ranging from education loans for students to growth capital for education institutions through education infrastructure loans (Source: CRISIL Report).Through student-loans – international and education loans – domestic businesses, the company provides loans and other value-added services to Indian students and professionals who are admitted to study overseas or at domestic institutions. It also provides collateral-backed financing to private educational institutions in India.

The Public Offer aggregating up to ₹3500 crore comprises of a fresh issue of equity shares of up to ₹1000 crores and an offer for sale (OFS) of up to ₹2500 crore by the “Selling Shareholder” (The “Offer for Sale”) with face value of ₹5 each equity share.

The offer for sale comprises of equity shares aggregating up to ₹1758 crore by Olive Vine Investment Ltd (“Promoter Selling Shareholder”); equity shares aggregating up to ₹342 crore by International Finance Corporation and, equity shares aggregating up to ₹400 crore by Kedaara Capital Growth Fund III LLP (“Kedaara Capital”, together with IFC, the “Investor Selling Shareholders”) (the promoter selling shareholder, along with the investor selling shareholders, collectively referred to as the “Selling Shareholders”) (“offer for sale”, and together with the fresh issue, the “Offer”).

The Promoter of the Company is Olive Vine Investment Ltd.

Avanse Financial Services Limited proposes to utilize the Net Proceeds towards augmenting capital base to meet the Company’s future capital requirements arising out of growth of business and assets.

The Equity Shares that will be offered through the Red Herring Prospectus are proposed to be listed on the Stock Exchanges, being BSE Limited (“BSE”) and National Stock Exchange of India Limited (“NSE” together with BSE, the “Stock Exchanges”)

Kotak Mahindra Capital Company Limited, Avendus Capital Private Limited, J.P. Morgan India Private Limited, Nomura Financial Advisory and Securities (India) Private Limited, Nuvama Wealth Management Limited (formerly known as Edelweiss Securities Limited) and SBI Capital Markets Limited are the Book Running Lead Managers to the issue.