OnEMI Technology Solutions IPO review: Should you apply?

Summary: OnEMI Technology,  parent of digital lending platform Kissht, is raising Rs 850 crore through its IPO that will be open between April 30, 2026 and May 5, 2026. Check the business’ strengths, weaknesses and risks before making an investment decision.

OnEMI Technology Solutions IPO will open for subscription on April 30, 2026 and close on May 5, 2026. Here’s a review of the fintech company’s business model, strengths, risks and valuation to help you decide whether the offer is worth your money or not.

What the company does

OnEMI Technology Solutions runs consumer lending platform Kissht as its parent entity. It mainly operates in unsecured personal loans, which made up about 94 per cent of assets under management in the first nine months of FY26. These are small-ticket loans, typically under Rs 5 lakh, aimed at salaried and self-employed borrowers. But in practice, loan sizes are far smaller with the average ticket size being Rs 25,556 in the nine months of FY26.

The company reaches customers through two apps: Kissht, where borrowers apply directly online; PaywithRing works offline, letting customers scan a QR code at a retail store and receive instant credit at checkout.

The remaining business comes from loans against property, a secured segment targeting MSMEs and self-employed individuals. These are larger, longer-tenure loans, serviced through a modest branch network.

What’s good

The economics of the business are compelling. OnEMI earns high yields from borrowers who have limited access to formal credit. In FY25, it lent at an average yield of nearly 32 per cent, while borrowing costs were about 14 per cent. That spread translates into strong margins.

Growth has matched this profitability. AUM has expanded at a staggering 80 per cent annually over the past three years, reflecting both demand and the company’s ability to scale its model.

What’s not

The same model that drives growth also introduces fragility. Unsecured lending offers no fallback when borrowers default. There is no collateral to recover and the borrower base is inherently more vulnerable to income shocks. This is visible in the numbers. The credit cost ratio, which depicts the share of the loan book lost to defaults each year, surged to 32 per cent in FY24 before pulling back to 9.7 per cent in FY25.  The company’s gross NPA has also surged from near zero in FY23 to 2.9 per cent by FY25.

There are structural risks as well. A portion of lending is done through co-financing arrangements with partner institutions (other banks and NBFCs). These partnerships are not exclusive and can be renegotiated or terminated. Even where loans sit on a partner’s books, OnEMI has to absorb up to five per cent of losses on those portfolios. In effect, it shares the risk without fully owning the asset.

Valuation check

At about 1.4 times post-IPO book, the valuation appears reasonable at first glance. But this is a business where the risk-reward balance is inherently skewed. The company’s superior return ratios stem from lending to borrowers avoided by traditional banks. That comes with the likelihood of higher defaults, elevated GNPA, volatile credit costs and greater sensitivity to economic cycles.

By contrast, established NBFCs like Bajaj Finance or Cholamandalam that command premium valuations of four to six times book have built their reputation over multiple cycles, with consistent asset quality and disciplined underwriting. Markets reward that predictability.

OnEMI’s growth is impressive but it comes with visible trade-offs, which is reflected in the valuation discount. 

Risk report

Company and business

• Will the company be able to scale up its business?

Yes. Digital mass-market lending is projected to grow at 48 per cent per annum through FY30, which should help the company scale up.

• Does the company have recognisable brands with client stickiness?

This metric is not meaningful for an NBFC, repeat borrowers signal the type of customers it serves, not brand loyalty.

• Does the company have a credible moat?

No. The company operates in a highly competitive online fintech lending industry. It competes with plenty of other new-age, digital-first players like KreditBee, Navi Finserv, Fibe and Moneyview.

Financials

• Did the company generate a current ROE of more than 12 per cent and an ROA of more than 1 per cent?

Yes. It reported an ROE of 17.7 per cent and an ROA of 7.14 per cent in FY25. These metrics further improved to an annualised ROE of 23.5 per cent and ROA of 8.5 per cent during the first nine months of FY26.

• Has the company increased its NII (net interest income) by 20 per cent annually over the last three years?

No. Their NII grew by around 17 per cent per annum from FY23 to FY25.

• Has the company's net interest income (NII) kept pace with the loan book growth?

No. While the company's total AUM grew at 80 per cent annually from FY23 to FY25, its NII declined from the peak of Rs 1,158 crore in FY24 to Rs 860 crore in FY25.

• Is the company’s capital adequacy ratio more than 15 per cent?

Yes. The company (through its lending subsidiary Si Creva) reported a capital to risk-weighted assets ratio (CRAR) of 25.2 per cent as of FY25, which further strengthened to 26.7 per cent in the first nine months of of FY26.

• Does the company have a cost-to-income ratio of less than 50 per cent?

No. It reported a cost-to-income ratio of 54.3 per cent in FY25, which increased slightly to 55.7 per cent during the first nine months of FY26.

• Can the company run its business without relying on external funding in the next three years?

No. The company's business model relies heavily on the timely and cost-effective procurement of external funds to support loan disbursements and manage liquidity. It has historically reported negative operating cash flows due to the rapid expansion of its loan portfolio, requiring continuous external debt financing.

• Are the company's three-year average gross NPA and net NPA ratios below 1 per cent and 0.5 per cent, respectively?

The company does not meet the threshold for gross NPA, but remains within limits for net NPA. Its three-year average gross NPA was around 1.24 per cent. In contrast, net NPA over the same period averaged 0.08 per cent.

A final word

IPOs are often the hardest places to assess a business. There is limited listed history, little evidence across market cycles and in many cases more narrative than proof. A better approach is often to look for established businesses with longer track records, stronger disclosures and more visible fundamentals.

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