Sachin Bansal-led Navi Technologies gets SEBI nod for Rs 3,350 Cr IPO
Navi Technologies, led by Sachin Bhansal has received a green light from, a market regulator, The Securities and Exchange Board of India (SEBI)for its first public offering.
The company, which was created by a co-founder of Flipkart, has been granted the final approval by SEBI to raise funds through a new issue of Rs 3,350 crore.
While saving the remaining funds for utilisation in general corporate purposes, the company will also invest Rs 2,370 crore in Navi Technologies (NFPL) and another Rs 150 crore in Navi General Insurance Limited (NGIL).
By filing its Draft Red Herring Prospectus (DRHP) with SEBI in March this year, Sachin Bhansal, and the company decided that the entire fundraise will be a fresh issue with no offer-of-sale, meaning Sachin—who has invested around Rs 4,000 crore into Navi to date—will not be diluting his stake of approximately 97.77% in the IPO.
An announcement was made by Navi technologies to raise up to Rs 600 crore through the issue of safe and redeemable Non-Convertible Debentures (NCDs) in may. According to data available on the Bombay Stock Exchange (BSE),for as of June 1,the public issue of Navi’s NCDs was subscribed 1.4X.
With NCDs face value of Rs 1,000 each for an amount aggregating up to Rs 300 crore with a green-shoe option to retain an oversubscription of up to Rs 300 crore,Navi’s digital lending application provides loans, including personal and home loans up to Rs 20 lakh immediately, apart from the services it offers financially and products like retail health insurance and mutual funds. The loan disbursal is based on its own paperless credit underwriting mechanism.
The company turned profitable in FY20-21, posted a consolidated profit of Rs 71 crore, with an overall income of Rs 780 crore and expenditure of Rs 673 crore. The fintech company’s revenue from operations has been reported to have increased from Rs 56 crore in FY20 to Rs 137 crore in FY21.
The Bangalore based company had faced a minor setback as the Reserve Bank of India (RBI) declined the banking licence for Chaitanya India Fin Credit Pvt Ltd—a micro-finance entity of Navi—as it was “not found suitable under Guidelines for ‘on tap’ Licensing of Universal Banks”.
Sachin Bhansal said “We are going to evaluate RBI’s written response and chart out our next course of action. A lot of options are there in front of us, and there are many things to explore like reapplying. We will consider whether we want to appeal this and weigh our options.”
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