OnEMI Technology Solutions Rs 926 crore IPO opened with muted demand, seeing just 2% subscription early on Day 1. A modest GMP signals mild listing gains. While margins and profitability have improved, high unsecured lending exposure and regulatory risks keep brokerages cautious, suggesting investors wait for clearer growth visibility.

OnEMI Technology Solutions IPO Day 1: Check subscription status, GMP; Should you subscribe?

The Rs 926 crore initial public offering (IPO) of OnEMI Technology Solutions opened for subscription today, witnessing a slow start in early trade. As of 10:30 am on Day 1, the issue was subscribed 2% against the total offer of 3.97 crore shares.

The retail portion saw a 2% subscription on 1.99 crore shares, while non-institutional investors (NIIs) showed slightly better interest, subscribing 4% of their allocated 85.36 lakh shares. Qualified institutional buyers (QIBs) are yet to place bids for their portion of 1.13 crore shares.

Despite the subdued response so far, the IPO has garnered early investor attention, supported by a modest grey market premium (GMP) of around 2.6% to 3%, indicating cautious but positive sentiment.

OnEMI Technology IPO price band, issue size and timeline

The IPO is priced in the range of Rs 162 to Rs 171 per share and aims to raise Rs 926 crore. This includes a fresh issue of Rs 850 crore and an offer for sale (OFS) of Rs 76 crore. The issue will remain open for subscription until May 5, with the listing expected in early May.

OnEMI Technology GMP and estimated listing price

In the grey market, the IPO is commanding a premium of approximately Rs 4.5 per share over the upper price band of Rs 171. This suggests a potential listing price of around Rs 175.5, reflecting mild upside expectations.

About the company

OnEMI Technology Solutions operates the digital lending platform Kissht and provides personal as well as business loans through a fully digital model. The company manages the entire loan lifecycle from customer onboarding to collections and generates revenue via interest income and fees from lending partners.

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The platform has scaled significantly, with over 6.3 crore users. Its data-driven underwriting and partnerships have enabled broader credit access, especially for underserved segments.

Financial performance

The company has reported mixed financial trends. Revenue declined to around Rs 1,352 crore in FY25 from Rs 1,700 crore in the previous year. However, profitability improved, with net profit at Rs 160.6 crore.

Margins have strengthened notably, with EBITDA margins rising to nearly 30% from under 10% two years ago.

Use of proceeds

Out of the IPO proceeds, Rs 637.50 crore will be primarily used to strengthen the capital base of its NBFC arm, Si Creva, to support future loan growth. A portion will also be allocated for general corporate purposes.

Valuation and peer comparison

At the upper price band, the company is valued at approximately 10 to 12 times earnings and about 0.9 times book value, which appears relatively discounted compared to larger peers like Bajaj Finance and SBI Cards.

Risks to consider

The business carries inherent risks, particularly due to its high exposure to unsecured lending, which accounts for over 90% of its loan book. This makes it more vulnerable to credit risk, especially during economic slowdowns.

Additionally, the company’s growth depends heavily on customer acquisition and retention, while regulatory changes in the digital lending space could impact operations. Sustained growth will also require continuous capital infusion.

Should you subscribe?

Brokerages have taken a cautious stance on the IPO. Swastika Investmart has assigned a “neutral” rating, citing reasonable valuations but highlighting concerns around unsecured lending exposure and inconsistent financial performance. The firm advises investors to wait for more stable growth visibility.

Equivision noted the company’s scalable AI-driven platform and strong asset quality but flagged sustainability of growth and credit risks as key concerns.

Meanwhile, SBICAP Securities Research highlighted strong financial metrics over recent years. Between FY23 and FY25, the company recorded a CAGR of 15.8% in net interest income, 29.6% in pre-provision operating profit, and 140.9% in net profit. Margins have remained healthy, with net interest margins ranging between 16.8% and 23.8% over the same period. Asset quality also appears stable, with gross NPA at 2.9% and net NPA at 0.4% as of December 2025. At Rs 171 per share, the IPO is valued at a post-issue price-to-adjusted book value (P/ABV) multiple of 1.6x, which analysts consider reasonable given its growth potential, though not without risks.

While valuations and margins are encouraging, the high unsecured exposure and evolving regulatory landscape suggest investors should approach the IPO with caution.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)

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