Aye Finance IPO Set to Launch: Key Dates, Price Band, and Financial Highlights
The initial public offering (IPO) of Aye Finance Limited, a prominent non-banking financial company (NBFC), is scheduled to open for subscription on Monday, February 9, and will conclude on Wednesday, February 11. Prior to this, the allocation for anchor investors is anticipated to occur on Friday, February 6, setting the stage for one of the notable public issues in the financial sector.
IPO Pricing and Company Overview
Aye Finance has fixed its IPO price band between ₹122 and ₹129 per equity share, each with a face value of ₹2. At the upper end of this range, the company's valuation reaches approximately ₹3,184 crore. Founded in 1993, Aye Finance specializes in providing both secured and unsecured small business loans, catering primarily to micro-scale MSMEs (Micro, Small, and Medium Enterprises).
The firm's loan products include:
- Mortgage loans and 'Saral' Property Loans
- Hypothecation loans for working capital needs
- Business loans secured by working assets or property
These financial solutions target clients across diverse sectors such as manufacturing, trading, services, and related agriculture, supporting business growth and operational requirements.
Financial Performance and Market Position
For the fiscal year ending March 2025, Aye Finance reported a profit of ₹175.3 crore, marking a slight increase from ₹171.7 crore in the previous year. The company's net interest income saw a substantial surge of 37.9%, rising to ₹858 crore from ₹622.2 crore, reflecting robust lending activities.
As of September 2025, Aye Finance served 5.86 lakh unique active customers and managed assets worth ₹6,027.6 crore, underscoring its expanding footprint in the lending landscape. According to the red herring prospectus (RHP), the company's listed peers include SBFC Finance Ltd, with a price-to-earnings (P/E) ratio of 27.32, and Five-Star Business Finance Ltd, with a P/E of 12.07.
IPO Structure and Major Investors
The ₹1,010 crore offering comprises a fresh equity issue of ₹710 crore and an offer for sale (OFS) of ₹300 crore by existing investors. Key selling shareholders include:
- Alpha Wave India
- MAJ Invest Financial Inclusion Fund
- CapitalG (affiliated with Alphabet)
- LGT Capital
- Vikram Jetley
Among the major pre-IPO stakeholders, Elevation Capital holds a 16.03% stake, followed by LGT Capital at 13.99%, Alphabet through CapitalG at 13.14%, and Alpha Wave India with 11.1%. British International Investment and A91 Emerging Fund both maintain stakes exceeding 9%.
The company plans to utilize the net proceeds from the fresh issue to meet future capital requirements arising from business expansion and asset development.
Grey Market Premium and Brokerage Views
As of today, the Aye Finance IPO grey market premium (GMP) stands at ₹0, indicating that shares are trading at the issue price of ₹129 without any premium or discount in the unofficial market, according to investorgain.com. Over the past week, GMP trends have been downward, with experts anticipating a further decrease, projecting a range between ₹0 and ₹5.
Brokerage firm SBICAP Securities has assigned a NEUTRAL rating to the issue, citing elevated valuations. At the upper price band, the offering is priced at a FY25 P/E ratio of 78.9x based on post-issue capitalization. The brokerage notes modest revenue growth projections—an 18% compound annual growth rate from FY23 to FY25—and a high attrition rate of 16.3% in FY25, which could impact the business model amid rising AI tools and in-house client services.
In contrast, Swastika Investmart highlights the company's remarkable turnaround from a ₹55 crore loss in FY24 to a ₹221 crore profit in FY25, driven by a 26% revenue increase. While valuations appear high at approximately 79x FY25 P/E, Swastika attributes this to a rarity premium for a publicly traded AI platform, recommending the IPO for high-risk, growth-oriented investors with a 3–5 year horizon to capitalize on global GenAI trends.
Subscription and Lead Managers
Subscription for the public issue will open at 10:00 IST on Monday, February 9. The lead managers for the IPO are Axis Capital, IIFL Capital Services, JM Financial, and Nuvama Wealth Management, with Kfin Technologies Ltd. serving as the registrar.
Disclaimer: The views and recommendations expressed are those of individual analysts, experts, and broking companies, and not of Bharat Horizon. Investors are advised to consult certified experts before making any investment decisions.
