Credila Financial Services IPO

Credila Financial Services Limited IPO Strengths

Strategic Advantage in a Growing Education Loan Market

Credila Financial Services Limited holds a strong position in India’s rapidly expanding education loan sector. Backed by rising overseas education demand, low Gross Enrolment Ratio, and NBFCs’ growing market share, Credila benefits from customised offerings, faster processing, and a vast untapped student population, making it a key player in this high-growth opportunity.

Robust Pan-India Distribution with Asset-Light Model

Credila Financial Services Limited operates a nationwide, omni-channel, asset-light distribution network across 41 cities. Supported by regional offices, digital channels, and 1,672 distribution agents, Credila leverages banks, consultants, and joint marketing to generate leads, ensure student support, and drive efficiency—achieving high disbursements per employee through a scalable hub-and-spoke model.

High-Quality Loan Portfolio Backed by Specialised Underwriting

Credila Financial Services Limited maintains superior asset quality through a robust, data-driven underwriting process. Its in-depth credit analysis, risk-based pricing, experienced team, and strong focus on employability and co-borrower strength ensure low delinquency across credit cycles. A diversified, resilient portfolio and stringent ECL practices further support Credila’s position as a disciplined and stable lender.

Technology-Led Risk Management Driving Asset Stability

Credila Financial Services Limited employs a robust risk management framework enhanced by data analytics and AI. With real-time monitoring, advanced credit modelling, and tech-driven systems like LOS, LMS, and a data lake, Credila ensures proactive risk detection, strong collections, and regulatory compliance—achieving high asset quality and collection efficiency across dynamic economic environments.

Diversified Funding and Prudent Asset-Liability Management

Credila Financial Services Limited maintains a well-funded, diversified liability profile with strong liquidity, low borrowing costs, and conservative asset-liability practices. With top-tier credit ratings, wide lender relationships, and robust interest rate risk management, Credila ensures financial stability and resilience—supported by high capital adequacy, dynamic monitoring, and a disciplined funding strategy across market cycles.

Experienced Leadership with Strategic Institutional Backing

Credila Financial Services Limited is led by a seasoned management team and a distinguished board, with deep expertise across finance, strategy, and governance. Supported by marquee investors like HDFC Bank, ChrysCapital, EQT, and Shinhan Bank, Credila leverages institutional knowledge, structured rewards, and strong governance to drive long-term growth, alignment, and operational excellence.

More About Credila Financial Services Limited

Credila Financial Services Limited, founded in 2006, is a specialised education finance company based in India. As a non-deposit-taking NBFC registered with the Reserve Bank of India (RBI), it is classified as a “middle layer” NBFC under the RBI’s Scale-Based Regulations (2023). The company focuses exclusively on providing education loans to Indian students for higher education in India and abroad.

With a mission to empower aspiring students and a vision to transform lives through quality education, Credila has grown to become a trusted name in education financing.

Industry Position and Financial Highlights

According to industry reports, Credila is a leading player among education-focused NBFCs (peer set includes three companies). Key highlights include:

• India’s largest education-focused NBFC with net loans of ₹414,693.08 million as of March 31, 2025

• Net profit after tax of ₹9,899.58 million in FY 2025

• Highest disbursements of ₹140,892.15 million in FY 2024

• Fastest growth in net loans, recording a CAGR of 64.96% (FY 2023–2025)

• 84.26% YoY AUM growth between March 2023 and March 2024

• Second-fastest loan growth YoY (47.67% from FY 2024–2025)

• Lowest gross stage 3 assets at 0.19% and second-lowest net stage 3 assets at 0.07% as of March 31, 2025

• Lowest cost-to-income ratio among peers: 19.65% (FY25) and 27.10% (FY24)

Loan Products and Customer Base

Credila offers tailored loan products primarily for:

• Master’s in Science (69.03% of total gross loans in FY25)

• MBA and postgraduate diplomas (11.32%)

• Other master’s programs, bachelor’s degrees, executive and certificate programs

As of March 31, 2025:

• 94.65% of AUM supported students studying abroad

• 5.35% of AUM went to students studying in India

• Average loan ticket size was ₹3.59 million

• Students financed in 64 countries, including the US, Canada, UK, Australia, Germany, and Ireland

Distribution Network and Outreach

Credila maintains the largest distribution network among education-focused NBFCs:

• 1,095 distribution agents (FY 2024)

• 1,672 total distribution channels as of March 31, 2025

• Presence in 41 Indian cities, including 32 branches and 8 regional offices

The company promotes brand visibility through seminars, student festivals, education fairs, and online engagement.

Risk Management and Technology

With a highly specialised underwriting model, over 91.98% of AUM as of FY25 involved borrowers with earning co-borrowers. A machine learning-based early warning system enables timely risk detection and resolution. Gross NPAs for the EMI portfolio stood at just 0.59% as of March 31, 2025.

Capital Strength and Credit Ratings

Credila has a diversified liability base, borrowing from 29 banks and financial institutions. It holds AA+ (CRISIL) and AA (CARE and ICRA) credit ratings, the highest among its peers, showcasing its strong asset quality, prudent management, and robust funding structure.

Leadership and Governance

Led by MD & CEO Arijit Sanyal, the leadership team includes seasoned professionals, many of whom have prior experience with HDFC. Its 12-member board comprises experts in finance, strategy, and governance. The company also benefits from institutional backing by EQT Group, ChrysCapital, HDFC entities, and Shinhan Bank.

Industry Outlook

• The Indian higher education sector (domestic and overseas) is projected to grow at 12–13% CAGR between FY2024 and FY2029, expanding from ₹13.5–14.0 trillion in FY2024 to over ₹24 trillion by FY2029.

• The domestic education financing segment (student loans) reached approximately ₹678 billion in FY2023, growing about 5% year-on-year.

• CRISIL estimates that education loan book growth among NBFCs may slow significantly, potentially falling to about half the rate seen in the prior year due to tighter overseas visa norms, especially in the US.

Key Growth Drivers

• Rising higher education aspirants: Increase in enrollments at both Indian and international universities continues to fuel demand for education loans.

• Escalating tuition costs: Education costs are rising faster than household incomes, making financing a necessity for many families.

• Government reforms:

• The National Education Policy 2020 aims for a 50% Gross Enrollment Ratio in higher education by 2035, promoting infrastructure growth and skilling.

• The Economic Survey 2024–25 outlines significant public investment in state-run institutions to support rising student demand.

• Tech-driven transformation: Fintech adoption and AI-based underwriting have made education loans more accessible and efficient.

Future Outlook & Segment Trends

• Retail Education Financing (Domestic + Overseas): Expected to remain strong through FY2029. Domestic loans, in particular, may grow at ~20% CAGR due to expanding college-age population and rising tuition fees.

• International Education Loans: This segment still holds promise but faces short-term challenges due to immigration and visa policy changes in destination countries like the US and Australia.

• NBFC and Alternative Lender Role: NBFCs are expected to continue expanding their market share by leveraging data, automation, and digital channels to serve both urban and underserved segments.

How Will Credila Financial Services Limited Benefit

• Increasing student enrolments will boost demand for education financing, expanding Credila’s loan portfolio.

• Escalating tuition fees will make education loans more essential, driving consistent growth.

• Government policies like NEP 2020 and public investment in education will strengthen domestic loan opportunities.

• Rising preference for Indian institutions offers a counterbalance to overseas loan challenges.

• Fintech and AI adoption aligns with Credila’s tech-driven underwriting, enhancing efficiency and scalability.

• Despite temporary global visa tightening, long-term aspirations for overseas education will sustain international loan demand.

• Credila’s widespread distribution network and presence in 41 cities position it to serve a broad customer base.

• High asset quality and prudent risk models ensure stability amid market shifts.

• Strong credit ratings and diversified funding allow Credila to grow competitively and securely.

Peer Group Comparison

Name of the Company	Revenue (₹ in millions)	Face Value (₹)	EPS (₹)	Return on Net Worth (%)	NAV	Price to Earning
Credila	47,197.3	10.00	47.80^	14.41#	397.39#	[•]*
Peer Groups
Avanse Financial Services Limited	23,470.72	5.00	19.94	12.84%	N.A.	N.A
Auxilio Finserve Private Limited	5,280.97	10.00	2.13	9.39%	N.A	N.A
Listed Peers
Home First Finance Company Limited	15,299.47	2.00	42.83	16.46%	279.97	32.36
Five Star Business Finance Limited	28,478.40	1.00	36.61	18.65%	214.13	20.58
Chola mandalam Investment and Finance Company Limited	258,459.8	2.00	50.72	19.71%	281.45	31.72
Bajaj Housing Finance Limited	95,756.10	10.00	2.67	13.44%	23.95	45.56
Aavas Financiers Limited	23,545.05	10.00	72.54	14.12%	550.93	25.93
Bajaj Finance Limited	696,835.10	1.00	268.94	19.35%	1,557.43	34.51^

Key Strategies for Credila Financial Services Limited

Strategic Expansion through Diversification and Innovation

Credila Financial Services Limited is focused on scaling its education finance business by strengthening university ties, expanding globally, tapping emerging markets, introducing value-added services, and launching tailored products. It continues exploring inorganic growth to deepen its presence across student segments and geographies.

Expanding Reach through Diversified Distribution Channels

Credila Financial Services Limited is strengthening its distribution network by onboarding new agents, enhancing school and college partnerships, launching scholarship initiatives, expanding into Tier 2 and 3 cities, and investing in digital acquisition—broadening customer access and boosting visibility across India’s evolving education finance landscape

Driving Efficiency through Digital Innovation and Automation

Credila Financial Services Limited is leveraging advanced technologies—including AI, machine learning, automation, and analytics—to optimise lead sourcing, credit decisioning, underwriting, collections, and customer journeys. These initiatives enhance operational efficiency, ensure faster approvals, and deliver a seamless digital experience for borrowers

Strengthening Funding Resilience and Sustainability

Credila Financial Services Limited seeks to enhance its liability profile by optimising funding mix, leveraging innovative instruments like social bonds, improving treasury operations, and maintaining capital buffers—aligning funding strategies with sustainability goals while actively managing costs and market opportunities through technology and automation