VC-backed Equitas files for India IPO
Indian microfinance institution Equitas Holdings has filed for an IPO, providing partial or complete exits for a number of VC and PE investors.
Equitas will seek to raise INR6 billion ($92.5 million) through the issue of an undisclosed amount of new shares, according to the prospectus. The company will also offer up to 130 million shares currently held by existing investors, some of which will exit their entire stake.
Those making a full exit include Sequoia Capital, WestBridge Capital Partners, Aavishkar Goodwell, Lumen Investment Holdings, and Aquarius Investments. The International Finance Corporation (IFC), Creation Investments and Helion Venture Partners are among those that will retain part of their stakes.
Pricing for the offer has not been announced. The company will use most of the expected proceeds - INR5.2 billion - to invest in its subsidiaries in order to help them meet their future capital requirements. The remainder will be used for general corporate purposes.
Equitas offers a wide range of financial products, including personal loans, vehicle financing, housing finance, and micro and small enterprise (MSE) finance. It is headquartered in Chennai and has 520 branches in 11 states across India. In the most recent fiscal year, Equitas provided loans totaling over INR36 billion.
The company was one of 10 groups to receive approval in principle for small finance bank licenses from the Reserve Bank of India last month. This license is meant to help provide financial services to India's large unbanked population and allow them to enter the formal banking system.
India's microfinance institutions have been increasingly tapped in recent years to help improve financial services in the country, with Equitas one of several companies to receive significant assistance from PE and VC investors. One of the firm's biggest investors is IFC, which committed INR1 billion in 2012, in addition to a INR500 million investment in Bangalore's Ujjivan.
For the year ended March 2015, Equitas reported revenue of INR89.17 million, up from INR28.84 million from the previous year. Over the same period, net profit rose from INR12.8 million to INR38.12 million.
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