Gurgaon-based small business lender Aye Finance is a long-standing darling of India’s impact investing scene. The 12-year-old firm developed an early alternative credit scoring approach to improve access to credit for India’s underbanked small businesses.
Aye’s initial public offering last week is giving its investors a long-awaited opportunity to exit. Lightrock, the London-based impact investing group launched by Prince Max of Liechtenstein, which led Aye’s $10 million Series B financing in 2016, announced a partial exit from the company.
Aye has 560 branches throughout India, and makes about $450 million in loans each year.
“Lightrock has witnessed how their innovative approach to lending has unlocked economic opportunity for thousands of underserved businesses across India,” Lightrock’s Samir Abhyankar said in a statement.
One of Aye’s earliest backers, Accion Venture Lab (now Accion Ventures) exited in 2018 when Aye raised its Series C round.
Other Aye backers that have supported the company’s growth over the years include equity investors British International Investment and ABC Impact, and debt investors FMO, Symbiotics, responsaAbility, BlueOrchard, Triple Jump and MicroVest.
Public listing
Shares of Aye Finance fetched 129 rupees ($1.42) in the IPO on the National Stock Exchange, India’s largest exchange, and the Bombay Stock Exchange, its oldest. They’re now trading at between 136 and 137 rupees on both exchanges.
Emerging market impact investors haven’t seen many exits via public listings. Last month, Nigeria-based infrastructure credit firm InfraCredit provided its founding investor, PIDG, an exit after it listed on Nigeria’s NASD OTC Securities Exchange.
In 2024, food and agriculture investor Africa Eats listed on the Stock Exchange of Mauritius, along with two of its portfolio companies. The deal aimed to give growing African companies, which struggle to secure the financing they need through banks and other private channels, access to the much bigger public markets.