Findi Limited has responded in detail to ASX queries over its valuation approach for its Indian subsidiary TSI, clarifying peer selection, valuation multiples, and compliance ahead of TSI’s planned IPO on the Bombay Stock Exchange.
- Findi explains selection and exclusion of Indian fintech peers for TSI valuation
- Forward EV/EBITDA multiple range of 15x-19x used, significantly discounted versus peers
- Discrepancy between TSI’s implied IPO valuation and Nova Global’s investment valuation addressed
- FX assumptions and risk discounts detailed to support valuation methodology
- Findi confirms compliance with ASX Listing Rules and continuous disclosure obligations
Context of the ASX Query
Findi Limited (ASX – FND) has provided a comprehensive response to the Australian Securities Exchange’s recent queries concerning the valuation methodology and disclosures related to its Indian subsidiary, Transaction Solutions International (TSI). This follows Findi’s announcements about a strategic investment by Nova Global Opportunities Fund PCC and TSI’s planned initial public offering (IPO) on the Bombay Stock Exchange (BSE) by the end of fiscal year 2027.
The ASX’s scrutiny focused on the basis for Findi’s forecast valuation of TSI, which ranges between A$750 million and A$900 million, and the apparent discrepancy with the valuation implied by Nova Global’s investment, which is significantly lower. The exchange also sought clarity on peer selection, valuation multiples, foreign exchange assumptions, and compliance with continuous disclosure rules.
Peer Selection and Valuation Multiples
Findi explained that the list of peer companies used to benchmark TSI’s valuation was curated with the assistance of Indian brokers and investment banks involved in the IPO process. Starting from over 400 listed financial services companies, the list was refined to those operating fintech and payment business models analogous to TSI’s evolving focus.
TSI currently operates two segments – cash logistics and digital banking/fintech. While historically cash-focused, the company is pivoting towards fintech, exemplified by its acquisition of BankIT Services Pvt Ltd. Accordingly, Findi concentrated on peers reflective of this digital transformation.
Notably, Findi excluded certain peers with non-fintech business models or those with high trading multiples that could set overly optimistic IPO expectations. For instance, companies like BLS E-Services and Fino Payments Bank were excluded due to their elevated EV/EBITDA multiples.
Findi justified its use of a forward-looking EV/EBITDA multiple range of 15x to 19x for TSI, which represents a 38% to 51% discount to the average multiple of 30.87x among selected peers. This conservative approach accounts for risks and the transitional nature of TSI’s business model.
Addressing Valuation Discrepancies and FX Assumptions
The company clarified the apparent incongruity between its forecast valuation of up to A$900 million for TSI and the implied valuation of approximately A$143 million based on Nova Global’s investment. This difference arises because the Nova Global valuation reflects TSI’s current, partially funded state, whereas the forecast assumes a fully funded business closer to its strategic fintech ambitions.
Regarding foreign exchange, Findi used an AUD to Indian Rupee conversion rate of 1 – 57.5 based on a six-month average ending December 2025. The company considers this assumption reasonable, noting the current rate is near a historical high and that FX fluctuations primarily affect the Australian dollar presentation rather than TSI’s underlying Indian Rupee earnings.
Risk Discounts and Compliance Confirmation
Findi acknowledged risks related to peer selection, valuation visibility before the IPO, and structuring advice, which could impact the final offer size and execution. To mitigate these, the company applied a significant discount to peer multiples in its valuation range.
Importantly, Findi confirmed its compliance with ASX Listing Rules, particularly continuous disclosure obligations under Listing Rule 3.1. The company also affirmed that its responses were authorised by its board or delegated officers, underscoring its commitment to transparency amid the IPO process.
Implications for Investors and Market
Findi’s detailed disclosures provide investors with greater clarity on the valuation assumptions underpinning TSI’s upcoming IPO and the strategic rationale behind Nova Global’s staged investment. The company’s conservative valuation approach and risk adjustments may temper expectations but also reflect prudent governance amid market uncertainties.
As TSI progresses towards listing on the BSE, investors will be watching closely how these forecasts translate into actual market valuations and how Findi manages the transition of its Indian fintech business.
Bottom Line?
Findi’s careful valuation disclosures set the stage for a pivotal IPO, but investors should watch for evolving market realities and funding outcomes.
Questions in the middle?
- Will TSI’s IPO valuation align with Findi’s conservative EV/EBITDA multiple range or diverge significantly?
- How will the ongoing minority shareholder dispute in TSI affect ownership and valuation outcomes?
- What impact will fluctuations in the AUD/INR exchange rate have on Findi’s reported financials post-IPO?