Whalesbook
OnEMI's IPO: Details of the Public Offering
OnEMI Technology Solutions, which operates the digital lending app Kissht, is set to launch its Initial Public Offering (IPO) next week. The company plans to raise ₹1,000 crore through a mix of new shares and an offer for sale. Of the funds raised, ₹750 crore will go to its Non-Banking Financial Company (NBFC) arm, Si Creva Capital Services, for lending. The remaining ₹250 crore is for general corporate needs. The offer for sale involves about 0.89 crore shares from current investors. As of March 31, 2025, OnEMI had 53.23 million registered users and 1.9 million active borrowers, with Assets Under Management (AUM) at ₹4,086.6 crore.
Financial Performance Shows a Dip
Despite growth in its operations, OnEMI's financial results for Fiscal Year 2025 (FY25) showed a significant slowdown. Total income fell 20% to ₹1,352.7 crore from ₹1,700.3 crore the year before. Profit after tax also dropped 18.5% to ₹160.6 crore, down from ₹197 crore in FY24. The company cited competitive pricing, a shift to longer loan terms (which delayed income recognition), and lower fees for the dip. However, OnEMI's balance sheet grew, with total assets reaching ₹2,701 crore and net worth rising to ₹1,006 crore by the end of FY25. Total borrowings were ₹1,507.6 crore.
Indian Fintech Sector Faces Evolution
India's fintech industry is changing, moving from rapid expansion to consolidation and tougher regulation. Digital lending platforms are projected to have disbursed over 11 crore loans by mid-2026, totaling more than ₹2.9 lakh crore. The market now favors platforms with strong lending assessment and service capabilities, with digital lending expected to grow 30-40% annually. OnEMI competes with major players like Lendingkart, FlexiLoans, and KredX, plus a vast number of other fintech lenders. Investment focus has shifted away from unsecured lending in 2025, with investors preferring secured models due to new rules and collection difficulties.
Regulatory Shifts and IPO Market Sentiment
Digital lending in India now operates under clearer rules from the Reserve Bank of India (RBI). New guidelines focus on protecting borrowers, making platforms accountable, and ensuring clear fee structures and fund flows. The RBI also brought back Default Loss Guarantee (DLG) framework rules in February 2026, offering some support to NBFCs and fintech firms. The current IPO market for fintechs is very cautious. Investors now prefer companies showing clear profits and strong business models over just rapid growth. A weaker rupee and unstable global markets have also lowered investor confidence, prompting many fintech companies to delay their IPO plans. Aye Finance's poor stock performance after its 2026 IPO, down 26% post-listing, highlights these risks.
Key Investor Concerns for OnEMI
OnEMI's IPO faces scrutiny due to its FY25 financial slowdown. The revenue and profit drops, even with growing AUM, suggest possible pressure on lending margins. Its strategy to offer longer-term loans could hurt short-term profits. With borrowings of ₹1,507.6 crore against a net worth of ₹1,006 crore, its debt level requires careful review, especially as investors focus on balance sheet strength. While new regulations promote responsible lending, they also mean ongoing compliance costs and adjustments for lenders. The cautious fintech IPO market, favoring profitability and wary of recent poor performances by peers, may limit OnEMI's valuation.