Elevation Capital-backed MSME lender Aye Finance has filed its draft red herring prospectus (DRHP) with the Security Exchange Board of India (SEBI) for an initial public offering (IPO).

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%).

The Gurugram-based company, which focuses on providing financial services to micro, small, and medium enterprises (MSMEs), offers three loan products with values ranging from Rs 50,000 to Rs 1,000,000. It offers secured loans against property and working assets, as well as unsecured business loans.

During FY24, Aye recorded a revenue of Rs 1040 crore and Rs 171.7 crore in net profits. In the first half of the ongoing fiscal year (H1FY25), the company posted a revenue of Rs 692 crore with a profit of Rs 144 crore.

The company ended FY24 with assets under management (AUM) of Rs 4463 crore. Its AUM grew to Rs 4980 crore as of September 30, 2024.

The company also boasts a low net non-performing asset (NPA) ratio of 0.9% and a provision coverage ratio (PCR) of 72%.

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