Companies

U GRO Capital raises ₹75 cr from Sachin Bansal, Poonawalla Finance

Rajesh Kurup Mumbai | Updated on October 07, 2019 Published on October 07, 2019

U GRO Capital, a technology-enabled lender to small businesses, has raised a total of ₹75 crore through unconventional modes, through issuance of non-convertible debentures (NCDs) and a securitisation deal.

The BSE-listed company has raised ₹50 crore from technology entrepreneur and Flipkart co-founder Sachin Bansal, who has invested in his personal capacity. U GRO Capital has issued NCDs, a first for the company, for the fund raising.

Earlier this month, in its first securitisation transaction, the firm raised about ₹25 crore from Poonawalla Finance, a part of the Cyrus Poonawalla Group. The ‘pass through certificates’ (PTCs) were assigned ‘A-’ rating by Acuité and consists of loans given to small businesses.

“We wanted to break this myth that liquidity is not available. For companies which are deeply focused and with deep under writings and with good quality assets, liquidity is not a constrain,” U GRO Executive Chairman Shachindra Nath said.

“This also underlines the high standards of corporate governance at U GRO Capital as these unconventional methods — NCD issuance and securitisation deal — are unique for a company at an early stage and especially when market conditions are not conducive,” he added.

U GRO Capital has an SME lending platform that automates credit appraisal process while offering a loan to provide an in-principal approval in less than an hour. It has developed sectoral statistical scorecards that predict customer behaviour, systems for fraud management and data validation.

U GRO, founded by financial services professional Shachindra Nath, had raised about $140 million from a set of global private equity investors in December 2017. The investors included NewQuest, ADV Partners, PAG and Samena Capital and public market investors such as Abakkus, PNB Metlife and multiple Indian family offices.

The company started disbursals in January and has so far disbursed more than ₹600 crore in debt to more than 6,000 small businesses across India.

It focuses on eight sectors and 38 sub-sectors and provides credit by using specialized sectoral statistical scorecards, deep sub-sectoral underwriting algorithms and a integrated technology platform. The company provides an in-principal credit approval within 60 minutes.

Published on October 07, 2019
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