IIFL Finance shares rally 5% as Blackstone leads Rs 6,414 crore capital infusion

IIFL Finance shares rallied as much as 4.90% to hit an intraday high of Rs 657.70 during Wednesday’s trading session after the company announced a Rs 6,414 crore ($686 million) primary capital infusion led by global investment firm Blackstone and its promoters.

The proposed fundraise is among the largest primary private equity investments in a listed Indian non-banking financial company (NBFC).

In a regulatory filing, IIFL Finance said its board, at a meeting held on November 10, approved the capital raise through a preferential issue.

Blackstone Private Equity will invest Rs 5,000 crore ($535 million) through a preferential allotment of compulsorily convertible preference shares (CCPS). These shares will convert into equity shares at Rs 602 apiece, in line with the regulatory pricing, within 18 months of allotment.

Meanwhile, the company’s promoters, Nirmal Jain and R. Venkataraman, will invest Rs 1,264 crore ($135 million) through a preferential allotment of warrants. Anchorage Capital will also participate in the transaction with a primary equity investment of Rs 150 crore ($16 million).

The company and its promoters have entered into definitive agreements with Blackstone and Anchorage Capital for the proposed transaction, which remains subject to customary regulatory and shareholder approvals.

According to IIFL Finance, the capital infusion will strengthen its capital adequacy, lower its cost of funds and accelerate growth in its gold finance business, a secured retail lending segment.The proceeds will also support IIFL Finance’s ambition to emerge as one of India’s largest diversified retail NBFCs.

The company aims to tap Blackstone’s global network and expertise in operations, technology, data and AI to expand its secured lending businesses, attract talent and strengthen its market position.

The proposed appointment of Blackstone representatives to the company’s board is also expected to enhance governance standards and oversight.

Welcoming the investment, founder and Managing Director of IIFL Finance Nirmal Jain said the partnership would provide the company with additional capital to expand its businesses, invest in technology and deepen co-lending partnerships with banks while maintaining a disciplined approach to risk and capital.

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IIFL Finance share price performance and Technical indicators

IIFL Finance shares have gained around 11% over the past week. The stock currently commands a market capitalisation of approximately Rs 26,838 crore. Its 52-week high stands at Rs 705.

On the technical front, Trendlyne data shows that the stock is trading above all eight of its simple moving averages (SMAs), indicating strength across these moving-average indicators.

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