Decoding The Commerce And Lending Engines Of IPO-Bound OfBusiness

OfBusiness helps small and medium enterprises buy raw materials, access working capital and discover business opportunities. It has expanded from sourcing steel and chemicals into manufacturing, apparel and lending through Oxyzo. The IPO matters because it will bring the company into public markets after a decade of expansion and profitability.

The company has achieved something unusual in Indian B2B commerce: both OfBusiness and Oxyzo independently became unicorns. Its consolidated operating revenue reached ₹20,472 Cr in FY26, while net profit rose 21% to ₹724 Cr. That gives public investors a large, profitable business to assess.

The IPO also highlights a business-model question. Commerce produced 93% of revenue, but financial services generated more segment profit. OfBusiness must show whether manufacturing and scale can improve commerce returns, while lending and technology deepen each SME relationship.

OfBusiness has two economically different engines. Commerce covers raw-material trading, manufacturing and finished goods, while financial services are led by Oxyzo. Commerce is vastly larger by sales, but lending is more powerful by profit contribution.

In FY26, commerce generated 93% of consolidated operating revenue, or roughly ₹19,000 Cr based on the reported total of ₹20,472 Cr. Financial services accounted for the remaining share. Yet financial services generated ₹505 Cr in segment profit before tax, compared with ₹422 Cr from commerce.

This contrast shows why revenue size alone does not explain the company’s economics. Trading moves large volumes but usually earns thin margins. Lending is smaller in scale, but interest income and related financial returns can produce more profit per relationship. The challenge is improving commerce returns without weakening lending growth.

Oxyzo is the lending business built within the OfBusiness ecosystem. It provides financial services alongside the group’s commerce activities, helping SMEs access working capital. Oxyzo has also achieved unicorn status independently, making it more than an internal support function.

The contrast comes from different economics. Commerce generated 93% of OfBusiness’s ₹20,472 Cr FY26 operating revenue, but financial services generated ₹505 Cr in segment profit before tax. Commerce generated ₹422 Cr. Thus, lending produced more profit despite being a fraction of commerce’s revenue size.

Trading raw materials requires substantial volume and can face commodity-price swings. Lending can earn stronger returns from each customer relationship when credit is managed effectively. Oxyzo also benefits from OfBusiness’s access to SME customers, procurement activity and business-discovery platforms, although the article does not disclose its standalone revenue.

Revenue measures the value of goods and services sold, while net profit reflects what remains after costs. They can move in opposite directions when a company sells less of low-margin business, improves its mix or receives more profit from a higher-return segment.

OfBusiness’s FY26 commerce revenue was hurt by a 20% decline in metals sales, lower mild-steel prices and delays in two mega projects. The company also exited lower-return commerce categories and discontinued operations to prioritise margins and manufacturing integration. Meanwhile, financial services generated ₹505 Cr in pre-tax profit, more than commerce’s ₹422 Cr.

The result was a nearly 8% decline in consolidated operating revenue alongside a 21% increase in net profit to ₹724 Cr. The disclosures do not separate the effects of strategic exits from market headwinds, but they show that OfBusiness’s profit mix is changing.

OfBusiness’s commerce engine has three layers: raw-material trading, manufacturing and finished goods. Trading aggregates SME demand and manages sourcing, pricing, quality and delivery. Manufacturing adds control over selected products, while finished goods help the company enter new markets. Financing adds a separate revenue and profit stream.

For example, more than 12,000 SMEs and emerging corporates transacted on OfCommerce in FY26 across 103 products. OfBusiness manufactured six of 26 listed metal products and eight of 26 chemical products in-house. Oxyzo supplied the lending layer, while BidAssist and Nexizo helped discover customers and market opportunities.

The model links procurement, production, customer discovery and credit. Trading provides volume and customer data. Manufacturing can improve supply and margins. Lending can monetise the same SME relationships. In FY26, commerce generated 93% of revenue, but financial services generated more segment profit, showing where the economics are strongest today.

Commodity trading mainly earns money by moving large volumes between suppliers and customers. It is useful for scale, but margins are often thin and prices can change quickly. Manufacturing changes the role of the company from intermediary to producer in selected categories.

OfBusiness says it chooses products where it can add value to the supply chain. In metals, its FY26 report identifies six of 26 products made in-house under brands including Noble, Bison and Sangam Steel. It had more than 1.1 Mn tonnes of annual capacity, and structural-steel capacity rose from 100,000 to 500,000 tonnes.

Making products can give OfBusiness greater control over quality, availability and production economics. Chemicals follow the same approach, with eight of 26 products manufactured in-house and more than 80,000 tonnes of annual capacity. The strategy is selective, because commerce still faces price pressure and demand-related headwinds.

Working capital is the money a business needs for routine operations, including buying inputs, paying suppliers and supporting production before customers pay. Lending for this purpose helps a company bridge the timing gap between spending money and collecting revenue. It is especially important for small and medium enterprises.

An SME may need to purchase steel, chemicals or other materials before it receives payment for finished goods. A working-capital loan can fund that purchase, allowing the business to accept orders and continue operating. OfBusiness began by helping SMEs buy raw materials and access working capital, linking procurement with financing.

For OfBusiness, lending also creates a deeper relationship with customers already using its commerce platform. Oxyzo leads this financial-services business. In FY26, financial services generated ₹505 Cr in pre-tax profit, showing how financing can become a major profit engine alongside material trading and manufacturing.