IIFL Finance to raise Rs 6,414 Cr led by Blackstone

IIFL Finance has approved a Rs 6,414 crore ($686 million) primary capital raise, with Blackstone leading the round.

The board cleared the preferential issue at a meeting on Tuesday. The deal is one of the largest primary private equity infusions in a listed Indian non-banking finance company, according to IIFL.

Funds managed by Blackstone Private Equity will invest Rs 5,000 crore ($535 million) in compulsorily convertible preference shares, which will convert into equity at Rs 602 a share, in line with the regulatory price, within 18 months of allotment. The company said this would give Blackstone a stake of about 16 % on a fully diluted basis.

The promoters, Nirmal Jain and R. Venkataraman, will invest Rs 1,264 crore (135 million) through a preferential allotment of warrants, and will continue as co-promoters. Anchorage Capital is also participating, with a Rs 150 crore (16 million) primary equity investment. The company and its promoters have signed definitive agreements with both investors.

IIFL Finance said the entire sum will go in as primary capital. On a pro forma basis for September 2026, which would lift its capital adequacy ratio from roughly 17% to roughly 30%. The company said the money would support growth in its secured lending businesses, particularly gold finance, and could, over time, improve its credit ratings and lower its borrowing costs.

Nirmal Jain, founder and managing director of IIFL Finance, said: “We are delighted to welcome Blackstone as a partner in IIFL Finance. Their investment is a strong endorsement of the franchise our team has built, and of the opportunity to bring formal, secured credit to millions of underserved households and small businesses across India. Venkat and I are investing Rs 1,264 crores alongside Blackstone, which reflects our own conviction in the Company’s next phase of growth.

“This partnership is about more than capital. Blackstone brings deep experience in building market-leading businesses in India, strong governance discipline, and a global perspective. The investment strengthens our balance sheet and gives us the headroom to scale our franchises, invest further in technology, and deepen our co-lending partnerships with banks, while staying disciplined on risk and capital.”

IIFL Finance also expects to draw on Blackstone’s global network and operational expertise, including in technology, data and artificial intelligence. Blackstone representatives are proposed to join the board, which the company said would strengthen governance while preserving its entrepreneurial culture.

Mukesh Mehta, chief investment officer for India private equity and senior managing director at Blackstone, said: “We are pleased to invest in IIFL Finance, a leading retail lending platform in India with a strong franchise and commitment to serving underserved customers. Building great businesses has been central to our approach over more than two decades of investing in India, and we look forward to partnering with Nirmal, Venkat and the management team to support IIFL Finance’s continued growth.”

The transaction remains subject to customary regulatory and shareholder approvals. Trilegal advised IIFL Finance, while Khaitan & Co advised Blackstone.

IIFL Finance offers gold, business, home and microfinance loans, among other products, through 5,091 branches across urban and rural India. Blackstone, which says it manages nearly $1.4 trillion in assets, has been investing in India for 20 years."