Flipkart founder Sachin Bansal plans to take Navi Finserv public for Rs 4000 crores
Navi Technologies, owned by Sachin Bansal, is expected to file draught documents with the markets regulator for an IPO of Rs 4,000 crore later this week.
According to current plans, the business will begin its initial public offering (IPO) in June.
Bansal, who founded Flipkart in 2007 and sold it to Walmart in 2018, owns 97 percent of the company. The public offering will consist entirely of new shares, with no offer-for-sale (OFS) component. This indicates Bansal would not sell shares to investors in the proposed IPO.
Ankit Agarwal, Navi’s cofounder and chief financial officer, and Paresh Sukhtankar, a former deputy managing director at HDFC Bank, are shareholders in the Bengaluru-based company. Sukhtankar is also a member of the Navi board of directors.
While Navi intends to fund Rs 4,000 crore through the IPO, it hopes to raise at least twice that much from public debt later this year.
Navi would use the money to support the company’s aggressive expansion goals, including developing a loan book of Rs 20,000 crore over the next two years.
Over the following two years, the corporation expects to raise Rs 15,000 crore in debt from the public markets.
The Navi Group now comprises Navi Finserv, a personal and home loan platform; Navi Asset Management Company, a mutual fund platform; Navi General Insurance, a health insurance vertical; and Chaitanya Micro Finance, microfinance, and lending institution.
Chaitanya Micro Finance applied for a universal bank license from the Reserve Bank of India (RBI) in early 2020 but has yet to receive it.
Customers have expressed worries about data breaches. The Enforcement Directorate (ED) had issued a notice to Bansal for suspected violations of the Foreign Exchange Management Act (FEMA) standards when he was at Flipkart.
In September, Bansal filed a complaint with the Madras High Court, challenging the ED’s conduct.
Navi’s current loan book is close to Rs 3,600 crore. Home loans, personal loans, and microfinance loans are examples of this.
While personal loans are a well-established sector for the corporation, it is also expanding its home loan operation.
The news of Navi’s IPO comes when the value of India’s listed new-age enterprises has been eroding for a variety of reasons, the most recent of which is Russia’s invasion of Ukraine.
Other businesses, such as Delhivery and PharmEasy, have received Sebi permission for their initial public offerings but are unlikely to go public this fiscal year. Navi, on the other hand, is forging ahead.
Navi Technologies reported consolidated earnings of Rs 71 crore in 2020–21 (FY21). Revenues increased to over Rs 780 crore in FY21 from Rs 221 crore in FY20, indicating a significant increase in earnings.
However, due to expenditures in expansion and technology, the firm may not be able to maintain profitability in FY22.
With all these things considered it will be interesting to see how this IPO will help Navi.
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