The fear of Trump’s tariff, the company was going to bring an IPO of Rs 2800 crore; Now the plan can be changed

Veritas Finance IPO: US President Donald Trump’s huge tariff of 50 percent imposed on India has come into force from today. Its effect can be seen in many sectors of the country. There is a possibility of decline in the stock market as well. Sensing this: MSME Lander Veritas Finance Private Limited has postponed its Rs 2,800 crore IPO for some time.

Trump had earlier imposed a baseline tariff of 25 percent on India and now gave a tariff of 25 percent for the purchase of oil from Russia. That is, now 50 percent tariffs will be charged on goods sent from India to America. Veritas Finance has postponed this for the time being in view of the concerns of its impact on the country’s micro, small and medium enterprises (MSME) sector. Whereas according to sources, this non-banking finance company was going to bring its IPO this month.

Country’s MSME sector under pressure

The MSME sector of the country will have to bear the brunt of America’s heavy tariff, which is the backbone of the country’s export economy. According to the rating agency Crisil, the scope of India’s MSME sector is spread in many major areas ranging from cloth to gems and jewelery, seafood and chemical. Their export capacity is also more than 70 %. Now all these are under the purview of tariffs. For example, there are many small and big textile manufacturers in Tiruppur, Tamil Nadu, which work on low margins.

Even a little high and ninch in the incoming expenditure on input or logistic can derail their production. Similarly, there are many diamond traders in Surat, there are many domestic clothes industries in Panipat, Morbi has small porcelain industries, which are extremely sensitive to Trump’s 50 percent because America is their biggest export market. They can lag behind their rivals with tariffs.

Approval for IPO was received in April

Veritas provides loans to MSMEs settled in Finance cities and towns. Also, it also gives business loans for small businesses in villages. Veritas had planned to raise around Rs 2,800 crore through his IPO. It can include new shares of Rs 600 crore as well as an offer for sale (offs) of Rs 2200 crore.

Veritas received SEBI approval for his IPO in April, which is valid for the next 12 months. According to sources, maybe in the second half of the year, think about launching Veritas IPO. In fact, due to the tariff imposed by Trump, the NBFC, which fulfills the needs of the MSME sector, is seeing some restlessness in the market.

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