InCred Holdings IPO

About InCred Holdings IPO

The IPO of InCred Holdings will be a combination of fresh issue and an offer for sale (OFS). The size of the fresh issue will be ₹1,250 crore while the offer for sale (OFS) will comprise of 9,90,20,833 shares (9.90 crore shares). Out of the total offer for sale of 9.90 crore shares, the major participants in the offer include KKR India (4.00 crore shares), MNI Ventures (1.98 crore shares), MEMG Family Office (1.02 crore shares). V’Ocean Investments (0.67 crore shares), Moore Strategic (0.63 crore shares), Dalmia Enterprises (0.52 crore shares), and Others (0.22 crore shares).

InCred Holdings is a SEBI-registered merchant banker and alternative investment fund, which generates majority of its revenues through its material NBFC subsidiary (InCred Financial Services). InCred Financial Services (IFSL) offers a range of loan products that is based on a technology-based risk-first approach. The company has been consistently making profits over the last 3 years and as of March 2025, its assets under management (AUM) stood at ₹12,585 crore. The AUM and PAT of the NBFC have grown at a CAGR of 44.04% and 84.97% respectively. The company also boasts of steady return on assets (ROA) of 3.45%.

Objectives of InCred Holdings IPO

The principal objective of the IPO will be as under:

• Boosting capital adequacy of its NBFC subsidiary (InCred Financial Services)
  
• Minimum CRAR of 15% required and more to boost the lending book
  
• Meeting other offer related expenses of the issue and general corporate expenses
  
• Listing the shares on a stock exchange for wider reach and transparent valuations
  

Industry Outlook

Since lending and the operations of its NBFC subsidiary (InCred Financial Services) is the predominant revenue contributor, the industry analysis focuses on that aspect. Growth of NBFC sector is a function of macroeconomic growth and growth in the demand for credit. Demographics are conducive to credit growth in India with more than 90% of Indians below 60 years of age. India has 52% of the population under the age of 30, wherein the demand for personal loans and education loans are highest. These are the two major businesses of InCred Financial Services. Rising urbanization and rising middle class, apart from rising per capital incomes have increased credit affordability. Digital access to credit is the key.

India’s credit to GDP ratio at 93% is well below the average in key EM and DM markets like Brazil, Germany, China, the US and UK. India’s systemic credit is expected to grow in the range of 13%-15% between FY25 and FY28, and this growth will be led by retail credit. At the same time, the share of NBFCs in overall systemic credit is expected to go up from the current 21% to 24% by FY28, as banks trail NBFCs in credit growth, due to sluggish growth in bank deposits. At 17%-18%, NBFC credit will lead banking credit growth by 400-450 basis points. Also, while India’s household credit to GDP ratio has grown to 42% as of FY25, it is still well below countries like Germany, China, the US and UK.

Another dichotomy is the rural access to credit in India. While rural India accounts for 47% of GDP, it only gets 8% of the credit. That is where NBFCs can chip in. So, NBFC credit is likely to grow rapidly in the next few years due to factors like formalization of economy, growing working population, urbanization, digital options, higher disposable income, and financial inclusion efforts. Also, FinTech innovations like digital lending, use of AI in credit appraisal, and credit through UPI can be major boost for the growth of NBFC credit in India. It remains to be seen, what will be the impact of the recent RBI framework on scale-based regulation for NBFCs in India.

About InCred Holdings

The business of InCred Holdings predominantly comes from its NBFC subsidiary, InCred Financial Services (IFSL). As of December 2025, IFSL has AUM of ₹14,448 crore, with a healthy ROA of 3.45%. In the last 3 years, its AUM and PAT have grown at a CAGR of 44.04% and 84.97% respectively. The product portfolio of IFSL includes Personal Loans, Student Loans, Secured Business Loans (LAP), Specialized MSME Loans, and Lending to Financial Institutions. The customer focus has largely been on the under-served segments with small ticket sizes. While personal loans account for 55.3% of the asset book, student loans are 22.2%, Secured business loans 8.7%, and MSME loans 7.8%.

The company currently uses a mix of direct service agents (DSAs) and channel partners for promoting its lending products. Its CRAR at 24.97% is well above the statutory requirement of 15%. IFSL has Borrowing cost of 10.08% and AUM yield of 15.45%, leaving a healthy spread, resulting in NIM of 9.85%. Gross NPAs stand at 2.08%, but largely provided for, with net NPAs at just 0.73%.

The in-house developed AI-enabled platform is one of the keys to maintaining the lending cycle smoothly. AI and ML-driven modules have been implemented at various stages of the credit value chain; including origination, underwriting, verification, collection etc. While its personal loans are targeted essentially at the salaried class, the student loans are given entirely for post-graduate courses with focus on STEM courses.

Strengths of InCred Holdings

Here are some of the key strengths of InCred Holdings, with focus on IFSL.

• IFSL has a retail-focused lending business with diversified product portfolio
  
• A constantly growing and large total addressable market (TAM) for the company business
  
• Focus on asset quality and health through a risk-first approach
  
• In-house tech platform leverages AI and ML for credit origination and underwriting of risk
  
• Multi-channel distribution network that drives continuous customer engagement
  
• High quality internal team with extensive domestic credit expertise
  
• Diversified sources of funding, keeping credit spreads healthy
  
• Demographic dividends favourable for personal loans and education loans business
  

Risks of InCred Holdings

Here are some of the key risks that the IFSL business is vulnerable to.

• For InCred Holdings, overdependence (over 99.5%) on IFSL could be a concentration risk
  
• Over 50% of the revenues come from unsecured personal loans for IFSL, with high NPA risk
  
• Financial tightness in the economy tends to hit unsecured repayments first
  
• Gross NPAs at above 2% remains a key risk factor, especially in an economic downturn
  
• The credit business is exposed to risks of fraud, borrower delinquencies, and recovery delays
  
• Compliance risks and compliance costs tend to be high in the NBFC business
  
• More than 75% of the loans of IFSL are unsecured, which raises major collection risks
  
• Student loan portfolio exposed to visa risks, global policy shifts, and TCS on remittance
  
• Operating cash flows of the business have been negative, which can impact liquidity
  
• Since IFSL relies on short-term financing, asset liability mismatch is a potent risk factor
  
• The NBFC business is vulnerable to fluctuations in interest rates and inflation
  

Anchor Investor Bidding Date- TBA

IPO Registrar and Book Running Lead Manager

• IPO Registrar: MUFG Intime India Private Ltd
  
• Book Running Lead Manager: IIFL Capital Services, InCred Capital Wealth, Kotak Mahindra Capital, Nomura Financial Advisory, UBS Securities India
  

InCred Holdings Business Model

The most material subsidiary of InCred Holdings, InCred Financial Services (IFSL), is predominantly into personal loans and education loans, which account for 77% of its lending book. It has targeted the young population with limited access to the credit markets. The idea is to keep asset quality in check with the use of technology and AI for credit appraisal, underwriting risk, and for recoveries. In addition, IFSL is also into MSME lending, vendor financing, and asset backed lending.

InCred Holdings Growth Trajectory

Between FY23 and FY25, the net interest income (NII) of IFSL grew 128.2% to ₹1,065.32 crore. During the same period, the PAT more than tripled from ₹109.06 crore to ₹373.15 crore. Between FY23 and FY25, the ROE has grown from 4.66% and 10.38%, while the ROA grew from 2.21% to 3.45%. Average cost of borrowing has been steady between 10.0%-10.5%, while loan yields are down about 86 bps.

InCred Holdings Market Position

With AUM of ₹14,448 crore as of December 2025, IFSL is one of the fastest growing digital-first NBFCs in India. While IFSL may be smaller in size and AUM compared to the established NBFCs in India, it has a scalable model that is attuned to digital growth and is likely to be less vulnerable to credit cycles.

How to Apply for the InCred Holdings IPO?

• Step 1: Log in to your Kotak Neo Demat account to access IPO investments. Next, select the current IPO section.
• Step 2: Specify IPO details. Enter the number of lots and the price you wish to apply for.
• Step 3: Enter UPI ID. After entering your UPI ID, click submit. This will place your bid with the exchange.
• Step 4: Mandate Notification. Your UPI app will receive a mandate notification to block funds.
• Step 5: Approve Request. Your funds will be blocked once you approve the mandate request on your UPI.