Gurugram-based SME lender Aye Finance Ltd' net profit halved to Rs 30.59 crore in the quarter ended June 30, 2025 as compared to Rs 60.94 crore in the same quarter last year.

The company's net profit was also lower than the Rs 40.70 crore clocked in the quarter ended March 31, 2025, as per an independent auditor's report.

The fall in net profit could be attributed to the increase in impairment on financial instruments that rose from Rs 48.59 crore in the quarter ended June last year to Rs 86.71 crore in the quarter ended June this year. Employee benefit expenses also grew to Rs 115.30 crore in the quarter ended June 2025 from Rs 82.46 crore in the same quarter last year.

Aye Finance's total income jumped almost 19% to Rs 416.13 crore in the June quarter this year from Rs 350.64 crore in the same period last year. On a sequential basis, however, the company's total income fell slightly as it had reported a total income of Rs 420.11 crore in the quarter ended March 31, 2025.

In December last year, the Elevation Capital-backed company had filed its draft red herring prospectus (DRHP) with the Security Exchange Board of India (SEBI) for an initial public offering (IPO). It received the approval for the IPO from the SEBI in April this year.

The company aims to raise a total of Rs 1450 crore through its IPO -- which includes a fresh issue of equity shares worth Rs 885 crore and an offer for sale (OFS) amounting to Rs 565 crore.

Among those participating in the OFS are investors such as LGT Capital (Rs 150 crore), CapitalG LP (136.8 crore), A91 Emerging Fund (Rs 100 crore), Alpha Wave Ventures (Rs 100 crore) and MAJ Invest (Rs 56 crore). Individual shareholders such as Harleen Kaur Jetley and Vikram Jetley will sell Rs 14.5 and Rs 7.6 crore worth of shares respectively. 

Aye Finance's largest shareholder Elevation Capital (formerly SAIF Partners) is not participating in the offer for sale.

As per the DRHP, Elevation Capital owns 16.19% stake in Aye Finance, followed by LGT Capital (14.13%) and Alpha Wave (11.21%), CapitalG (10.26%), BII (9.51%), and A91 (9.23%).

Axis Capital, IIFL Capital Services, JM Financial and Nuvama Wealth Management are the book-running lead managers for the issue.