India: Fincare raises $13.6m from existing investors True North, TA Associates, others

Fincare Business Services Ltd, the promoter of Fincare Small Finance Bank, has raised ₹95 crore through a rights issue from existing investors, including private equity investors True North, TA Associates and Tata Opportunities Fund, said a senior executive of the company.

Other existing investors, including Leapfrog Investments, Kotak Mahindra Life, Edelweiss Tokio Life Insurance and Small Industries Development Bank of India (Sidbi), also participated in the rights issue.

The small finance bank had last raised funds in March 2017, when the same investors pumped in ₹500 crore.

A total of ₹140 crore, including the funds raised from the rights issue and reserves available with the company, will be infused into Fincare SFB to help grow the bank’s lending business, according to Keyur Doshi, chief financial officer.

The infusion will improve the bank’s capital adequacy ratio from 19% to 25%, he said.

The bank currently offers unsecured credit such as microfinance and secured credit products such as gold loans, loans against property and institutional finance. While the bank intends to grow both the secured and unsecured loan portfolios, the focus will be on increasing the share of secured credit in its overall loan book.

“The unsecured business has an 85% share. We plan to bring down the share to 80% by the end of this fiscal and 60-65% in three years,” said Doshi.

Fincare also plans to enter new lines of business. The bank plans to soon start two-wheeler financing and is also eyeing an entry into affordable housing finance.

“We will soon start two wheeler finance. From a rural India market perspective it is an important product. We have started pilots for this. We also plan to start affordable housing finance from the third quarter of this fiscal,” said Doshi.

Fincare aims to grow its total loan portfolio to ₹10,000 crore in the next three years, across its existing lines of business and the planned new businesses, he said. The bank’s loan portfolio stands at around ₹2,800 crore.

Fincare intends to raise another round of funds before it eventually plans to go public, said Doshi. “We are likely to raise another round at the start of 2019. We are still in the process of finalising the details. We could look at a combination of internal and external investors,” said Doshi.

The bank is eyeing a public listing in the next 18-24 months, he said.

This article was first published on livemint.com

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.