Veritas Finance Delays ₹2,800-Crore IPO Amid US Tariff Concerns
Veritas Finance, an NBFC backed by Multiples PE and Kedaara Capital, has delayed its planned ₹2,800-crore IPO due to concerns over new US tariffs on Indian exports. The tariffs, effective from August 27, include a 50% levy on Indian exports to the US and an additional 25% penalty for purchasing Russian oil. These are expected to impact key MSME sectors such as textiles, gems and jewellery, auto components, chemicals, and seafood. Veritas Finance, which focuses on MSME lending, reported a loan book of ₹6,517.00 crore and operations across 424 branches in 10 states and one union territory. The company is now considering launching the IPO in the second half of the fiscal year, subject to improved market conditions.
*this image is generated using AI for illustrative purposes only.
Veritas Finance Ltd, a non-banking financial company (NBFC) backed by Multiples PE and Kedaara Capital, has postponed its planned ₹2,800-crore initial public offering (IPO) due to concerns over the impact of US tariffs on India's export-oriented Micro, Small, and Medium Enterprises (MSME) sector.
US Tariffs and Their Impact
The decision comes in the wake of new US tariffs on Indian exports, which took effect on August 27. These tariffs include:
- A 50% tariff on Indian exports to the US
- An additional 25% penalty for purchasing Russian oil
The tariffs are expected to significantly affect several key sectors where MSMEs have substantial exposure, including:
- Textiles
- Gems and jewellery
- Auto components
- Chemicals
- Seafood
Veritas Finance's Business and IPO Plans
Veritas Finance specializes in providing financial services to the MSME sector, with a particular focus on working capital loans. The company reported:
- A loan book of ₹6,517.00 crore
- Operations across 424 branches
- Presence in 10 states and one union territory
- Over 88% of its loan book concentrated in five states
The company had initially planned to launch its share sale in August. However, the implementation of additional tariffs has led to a reassessment of market conditions.
Future Outlook
Despite the current postponement, Veritas Finance remains optimistic about its IPO prospects. The company is now eyeing the second half of the fiscal year for a potential launch, contingent upon improved market sentiment.
This delay highlights the interconnectedness of global trade policies and their potential impact on domestic financial markets and business strategies. As the situation evolves, many in the financial sector will be closely watching how companies like Veritas Finance navigate these challenges and adjust their plans accordingly.
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