Whalesbook
IPO Launch Amid Market Turmoil
InCred Holdings is set to launch an Initial Public Offering (IPO) aiming to raise ₹12.5 billion ($131.8 million) through new shares and an offer from existing shareholders. This IPO debut occurs in a challenging market, marked by significant withdrawals from foreign portfolio investors (FPIs). In April alone, FPIs pulled ₹60,847 crore from Indian equities, adding to a year-to-date outflow of ₹1.92 trillion, already surpassing 2025's total. The broader financial services sector also experienced outflows of ₹30,856 crore in April, signaling global investor caution amid geopolitical uncertainties and tight liquidity.
InCred's Strong Financial Performance
Despite external market pressures, InCred Holdings reports strong internal results. Its subsidiary, InCred Financial Services, a diversified non-banking financial company (NBFC), posted a profit after tax of ₹373 crore for the fiscal year ending March 2025, a notable increase from the previous year. Total revenue reached ₹1,893 crore in FY25. The company's loan book expanded 37% year-on-year to ₹12,384 crore as of March 2025. InCred specializes in personal, student, and secured business loans, supporting early-stage startups since its 2016 inception and disbursing over ₹25,000 crore. IPO proceeds will be used to strengthen its lending arm's capital base and fund further business expansion.
NBFC Sector IPOs and InCred's Valuation
The NBFC sector is a key contributor to India's primary market, with 24 NBFC IPOs raising ₹635 billion in 2025 alone, often seeing substantial oversubscription. This indicated strong past investor interest. InCred Holdings, with a reported Price-to-Book (P/B) ratio of 2.69 and a P/E ratio of 28.32 for FY25, is valued within the typical range for quality NBFCs, which often fall between 2x-4x P/B. Competitors like Bajaj Finance trade at a P/E around 30.19, while Jio Financial Services trades at a much higher P/E of 131.48. However, the Reserve Bank of India (RBI) has introduced new frameworks since 2025-2026 to enhance stability and risk management for NBFCs. These include stricter co-lending rules and increased compliance requirements.
Key Risks for the IPO
The primary risk for InCred's IPO stems from the current market sentiment. Continued FPI outflows and general investor caution reflect a global trend away from riskier assets, potentially reducing demand for new listings, especially in the financial services sector. While InCred shows consistent growth, it relies significantly on debt financing, which is more critical in a tightening liquidity environment. The evolving regulatory landscape, while aimed at stability, imposes new compliance and operational demands on NBFCs. Furthermore, InCred's operational history is relatively young compared to established financial giants, meaning its performance during a prolonged market downturn is largely untested.
What's Next for InCred
InCred Holdings' IPO is an effort to secure capital for future growth, leveraging its recent performance. Investor interest will depend on InCred's ability to demonstrate resilience and a clear growth path despite significant market challenges. The IPO's success will signal investor confidence in India's fintech NBFC segment, balancing the company's diversified business model and financial results against prevailing market uncertainties and the impact of recent regulatory shifts.