Laxmi India Finance is a lending business built for India’s invisible borrowers - the kirana shopkeeper, the carpenter, the tea-stall owner - who have steady cash flows but no payslip to prove it. It began in the 1990s as a vehicle-financing outfit in Jaipur, was reshaped after 2001 when Deepak Baid took over a small proprietorship doing co-lending with HDFC Bank, and then acquired an RBI-registered NBFC in 2011, folding a ₹32 crore portfolio and four branches into what would become a listed company after its 2025 IPO. The recurring idea is a branch-led, relationship-driven model that combines physical field verification with technology-enabled processes to lend against property and vehicles to customers banks and fintechs typically ignore. # Business segments A single lending engine, organised around the collateral that secures each loan - property, vehicles, or cash flows - and distributed through a branch network that does the sourcing, underwriting and collection itself. ## 1. Secured MSME and property-backed lending: the core of the book **Small-ticket loans backed by residential or commercial property, approved after a physical visit to the borrower’s business to estimate real cash flow - not paperwork.** - **Cash-flow underwriting, not payslips** - the company targets NIP (non-income proof) borrowers such as carpenters, kirana owners and small manufacturers who lack formal income documents, so credit officers visit the business premises, count inventory, observe daily sales and assess margins to build an income estimate. - **The whole family is assessed** - CIBIL reports are pulled for every family member, and combined income and liabilities are considered before sanctioning, which reduces the risk of hidden household debt. - **Collateral cushion is deliberate** - loans are written at a loan-to-value of 45-50%, with the overall portfolio LTV at roughly 42%, meaning the property backing each loan is worth more than twice the amount lent. - **Turnaround in just over a week** - the end-to-end process from application to disbursement takes 7-10 days, supported by hub-based credit teams that each cover two or three branches. ## 2. Vehicle finance: where the company began **Secured loans for commercial and personal vehicles, including a niche in refinancing older vehicles that other lenders avoid.** - **Refinancing vehicles aged 3 to 10 years** - the company extends loans for the purchase of older commercial and private vehicles, a segment where formal credit is scarce because most financiers prefer new or near-new assets. - **Electric three-wheelers are in the mix** - the product suite includes dedicated EV loans of up to ₹4 lakh for commercial three-wheelers, aligning the legacy vehicle-finance roots with a newer transport trend. - **Decisions in 24 to 48 hours** - the credit process runs from a field-officer lead check through a branch-manager visit to a telephonic review from Head Office, compressing turnaround to a day or two. - **The origin story** - the company started as Deepak Finance and Leasing Company in 1993-94 doing vehicle financing, and the post-2001 proprietorship co-lent with HDFC Bank and MAS Finance specifically in vehicle funding, so this engine carries the institutional memory of the business. ## 3. Unsecured and wholesale lending: the small, complementary books **Two minor portfolios - unsecured business and personal loans at about 2% of the book, and wholesale loans to entities that on-lend to individuals - that sit alongside the secured core.** - **Unsecured is kept deliberately small** - business loans up to ₹10 lakh and personal loans up to ₹4 lakh are offered without collateral, but the total unsecured exposure is held at roughly 2% of the portfolio, reflecting the conservative philosophy that runs through the company. - **Wholesale lending funds other lenders** - loans from ₹25 lakh to ₹5 crore are extended to entities that on-lend to individuals or groups in MSME and vehicle segments, secured by the underlying loan portfolio rather than physical property. # Branch-led distribution and collections **176 branches across six states act as the integrated sourcing, underwriting, servicing and collection infrastructure - every loan is originated, assessed and collected through the same local team.** - **Branches open before disbursements begin** - the company follows a cluster-based expansion strategy where new branches are established first, building local market understanding and customer connectivity, with breakeven typically reached at ₹1.5-2 crore in AUM within seven to eight months. - **A hub-and-spoke geography** - Collection Centres sit at the village level, Spoke Branches operate in district towns, and Hub Branches in major cities handle routing and oversight, creating a physical chain from the borrower’s doorstep to the company’s control points. - **One Relationship Manager owns the borrower** - dedicated RMs embedded at each branch handle sourcing, assessment and ongoing engagement, giving a single point of accountability across the loan’s life. - **Collections are field-intensive, not call-centre driven** - frequent in-person engagement, branch-level monitoring and early-warning systems are used to stay close to borrowers, with nearly 37% of them being first-time borrowers and a quarter being rural or semi-rural women entrepreneurs. # Technology and digital infrastructure **A digital-first operations platform with over 110 tech tools that speeds up credit decisions and manages the loan lifecycle, while the physical branch does the face-to-face work.** - **A tablet-based Loan Origination System** - the LOS, along with the Synofin LMS and Synno CRM, digitises the application and approval workflow, enabling the 24-48 hour turnaround on vehicle loans and 7-10 days on MSME loans. - **Integrated with external data sources** - the stack pulls in CIBIL, TransUnion and CRIF bureau data, uses Zigram for vehicle valuation, and connects to Digio, Decentro and Karza Technologies for verification, layering digital checks onto the physical field assessment. - **ISO and SOC 2 Type II compliant** - the security architecture runs on AWS with Cloudflare, Seqrite, Fortinet and Cisco layers, meeting standards expected by institutional lenders and regulators. # Funding and lender relationships **A diversified liability franchise of more than 50 lenders that has brought the cost of borrowing down while the company earns a double-digit spread on its loan book.** - **Borrowing from over 50 counterparties** - the lender roster includes 9 PSU banks, 10 private banks, 7 small finance banks and 22 NBFCs and financial institutions, so the company is not dependent on any single source of funds. - **Cost of funds is falling** - the average cost of borrowing declined from 11.48% to 10.80% over the year, while the portfolio yield was 21.30%, producing a spread of 10.50% and a net interest margin of 11.26%. - **Zero repayment delays to lenders since inception** - the company claims a clean track record with its funding partners, which supports its credit rating upgrade to Acuite A/Stable during the year. - **Nearly a third of the book is funded internally** - about 28% of the portfolio is supported by net worth and internal accruals, with a capital adequacy ratio above 26% and net worth of ₹465 crore, giving a thick equity buffer beneath the borrowings. # Group structure and partners **A promoter-led listed company with a 60% family holding, an independent board, and a single domestic lending segment.** - **Promoters hold 60.31%** - the remaining public float includes Alternative Investment Funds at 4.34%, Foreign Portfolio Investors at 1.58%, and retail and other public shareholders at 33.33%. - **The board mixes family and independents** - Managing Director Deepak Baid sits alongside Whole Time Directors Aneesha Baid and Prem Devi Baid, with four independent directors providing external oversight. - **A single reportable segment** - the company operates in one business (lending) and one geography (domestic India), with the original proprietorship’s co-lending operations merged into the acquired NBFC in 2011.