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Chennai-based non-banking financial company Veritas Finance has received observations from the Securities and Exchange Board of India (SEBI) on its draft IPO papers, clearing the way for the company to take its proposed public issue forward.
The capital markets regulator issued its observations on October 19, 2026, according to the processing status of draft offer documents published on November 9. Veritas Finance had submitted its revised draft papers on July 29, 2026.
The proposed IPO will comprise a fresh issue of equity shares worth ₹900 crore and an offer for sale (OFS) of up to 1.28 crore shares by existing shareholders.
Lok Capital Growth Fund, British Investment plc, D Arulmany, Growth Catalyst Partners LLC and Vidya Arulmany are among the shareholders looking to sell their holdings through the OFS. British Investment is backed by the UK government.
The company had first filed its draft IPO documents in January 2025, proposing to raise up to ₹2,800 crore. SEBI cleared that filing in April 2025, but Veritas Finance did not go ahead with the listing plan.
The NBFC has also retained the option of raising up to ₹180 crore through a pre-IPO placement. Any amount raised through this route before the filing of the red herring prospectus (RHP) with the Registrar of Companies (RoC) will be adjusted against the fresh issue.
Proceeds from the fresh issue are earmarked for strengthening Veritas Finance's capital base and funding its future business needs, including onward lending.
Veritas Finance shareholder details
Norwest Venture Partners holds a 21.58% stake in the company, making it its largest shareholder. Kedaara Capital Fund owns 15.08%, followed by British Investment with 10.33% and Lok Capital with 9.48%. Lok Capital was founded by Rajiv Lall and Vishal Mehta.
Established in 2015, Veritas Finance focuses on lending to micro, small and medium enterprises (MSMEs) and self-employed borrowers. Its portfolio includes small business loans, housing finance, used commercial vehicle loans and working capital facilities.
Veritas Finance financial performance
The NBFC reported a net profit of ₹330.4 crore for FY26, marking a 12% increase from the previous financial year. Net interest income (NII) grew 18% year-on-year to ₹1,133.5 crore.
Its assets under management (AUM) stood at ₹9,134 crore at the end of FY26, up 24.3% from ₹7,348.6 crore a year earlier. Disbursements during the year increased 16.4% to ₹4,579.5 crore, compared with ₹3,933.1 crore in the previous financial year.
The company identifies Five-Star Business Finance, SBFC Finance, Aavas Financiers, Aptus Value Housing Finance India and Sundaram Finance as comparable listed players.
ICICI Securities, IIFL Capital Services, JM Financial and SBI Capital Markets have been appointed as merchant bankers for the proposed IPO.
