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Education loan provider Credila Financial Services has filed its updated draft papers with capital markets regulator Sebi to raise Rs 5,000 crore through the initial public offering (IPO).

The proposed IPO comprises a fresh issue of equity shares worth Rs 3,000 crore and an offer for sale (OFS) of shares for Rs 2,000 crore by promoter entity and an investor, aggregating the total size of the public issue to Rs 5,000 crore, according to the updated draft red herring prospectus (UDRHP) filed on Thursday.

As part of the OFS route, promoter entity Kopvoorn BV (an affiliate of EQT Private Capital Asia) will sell shares worth Rs 950 crore and HDFC Bank Ltd will be offloading its stake in the company for Rs 1,050 crore.

Also, the Mumbai-based Credila Financial Services is looking to raise about Rs 600 crore in a pre-IPO round. If the pre-IPO round takes place, the size of the fresh issue will reduce accordingly.

The updated draft filing comes after Credila's confidential offer documents were approved by Sebi last month. The company filed its offer documents in December 2024, through the confidential pre-filing route.

Under the confidential filing process, Sebi reviews the confidential DRHP and provides comments on it. Thereafter, the company going public is required to file an update to the confidential DRHP (UDRHP-I) after incorporating the regulator's comments. This UPDRHP-I is made available for public comments for 21 days.

Finally, after incorporating the changes due to public comments, the company is required to update the DRHP-II (UDRHP-II).

Credila Financial Services can launch its IPO once the final prospectus is filed.

Going by the draft papers, the company proposes to utilise the net proceeds towards augmenting capital base to meet its future capital requirements arising out of growth of its business and assets.

Founded in 2006, Credila is an Indian education finance company focused on providing education loans to Indian students pursuing higher education in India and overseas. Since its inception, the company have disbursed loans totalling Rs 53,754 crore as of March 31, 2025.

According to the industry report, Credila is the largest education-focused non-banking financial company (NBFC) in the country (which peer set comprises three companies, including Credila), with net loans of Rs 41,469 crore as of March 31, 2025, and the highest disbursements of Rs 14,089 crore for FY24, and had reported the highest restated profit after tax of Rs 989.96 crore for the financial year ended March 2025.

In 2009, HDFC Ltd made an investment in Credila, and subsequently, it became a subsidiary of the company in 2010. In 2019, it became a wholly-owned subsidiary of HDFC Ltd and converted to a public limited company in the following year.

In June 2023, HDFC Ltd amalgamated into HDFC Bank, following which the EQT and ChrysCapital groups collectively acquired approximately 90 per cent stake in the company in March 2024.

The change of control came after the Reserve Bank of India (RBI) directed HDFC Bank to reduce its shareholding in the company to less than 10 per cent after the merger of HDFC Ltd with HDFC Bank.

Later, EQT and ChrysCapital groups' stake was diluted to 81.42 per cent, with South Korea's Shinhan Bank also acquiring an 11 per cent stake in Credila.

The company's shares are proposed to be listed on the BSE and NSE.

Axis Capital, Citigroup Global Markets India, Goldman Sachs (India) Securities, IIFL Capital Services and Jefferies India are the book-running lead managers, while KFin Technologies is the registrar for the IPO. 

(This report has been published as part of the auto-generated syndicate wire feed. Apart from the headline, no editing has been done in the copy by ABP Live.)