SK Finance Shelves India IPO Amid Weak Demand, Fails to Meet Valuation and Offer Size Expectations.

TPG-backed SK Finance has shelved its India IPO due to weak demand, despite reducing the valuation and offer size. The non-bank lender had initially sought to raise $183 million, but demand fell short. The IPO was filed in May 2022 and secured regulatory approval in August 2022, which expires this week. If the company revives the offering, it would need to refile for an IPO. SK Finance focuses on vehicle financing and small loans, and is also backed by Norwest Venture Partners.

TPG Inc.-backed SK Finance Ltd. has shelved plans for an initial public offering (IPO) in India after failing to attract sufficient investor demand. The non-bank lender had initially sought to raise $183 million but had to reduce its valuation and offer size to meet investor interest. Despite these adjustments, demand remained insufficient, leading to the shelving of the IPO [1].

SK Finance, which focuses on vehicle financing and small loans, had filed its draft IPO prospectus in May 2022 and secured regulatory approval in August 2024. However, the regulatory approval expires this week, necessitating a refiling if the company decides to revive the offering [1].

The IPO was expected to list on the BSE and NSE, with Kotak Mahindra Capital Co., Jefferies Financial Group Inc., Motilal Oswal Investment Advisors, and Nomura Holdings Inc. serving as book-running lead managers. The proposed offer size was initially set at ₹22 billion ($183 million) but was later reduced to ₹16 billion ($183 million) [1].

The decision to shelve the IPO comes at a time when shadow banks in India are under scrutiny due to their high interest rates and vulnerability to defaults, which can pose a stress point for the wider financial system. SK Finance, backed by Norwest Venture Partners, had been targeting customers with limited or no access to traditional banking services [1].

Comparatively, Patel Retail's IPO, which is also a Mainline Bookbuilding IPO proposed to list on BSE and NSE, has a total issue size of ₹242.76 Crore, with a final issue price of ₹255.00 per share. SK Finance's IPO, on the other hand, had an issue size of up to ₹2,200.00 Crore, with the issue price not specified [2].

SK Finance's decision to shelve its IPO underscores the challenges faced by non-bank lenders in raising capital through the public markets. The company will need to reassess its strategy and potentially refile for an IPO if it wishes to proceed with the offering.

References:
[1] https://www.bloomberg.com/news/articles/2025-08-26/tpg-backed-sk-finance-said-to-shelve-india-ipo-after-weak-demand
[2] https://www.chittorgarh.com/compare/patel-retail-ipo-vs-sk-finance-ipo/83/