India: NBFC Samunnati in talks with PE firms to raise up to $70m

Samunnati Financial Intermediation and Services Pvt. Ltd, a non-banking financial company (NBFC) specializing in loans to farmers and entities engaged in agriculture, is in talks with global private equity firms General Atlantic (GA) and Warburg Pincus to raise around $50-70 million, two people aware of the development said.

Mint reported on 13 December that Samunnati had started talks with PE firms for a new round of capital infusion.

“General Atlantic and Warburg are talking with Samunnati. They plan to dilute a significant minority stake through the latest fundraise that will help them raise around $50-70 million. The fundraise will help the agri-focused lender scale up its loan book and expand its branch network,” said the first person cited above, requesting anonymity as the talks are private.

Investment bank Kotak Mahindra Capital is advising Samunnati on the fundraise, said the second person cited above, also requesting anonymity.

The company was founded in 2014 by Anil Kumar S.G., a banker with more than 27 years of experience with banks such as ICICI Bank and Canara Bank.

Samunnati claims on its website that it has disbursed over ₹1,000 crore in loans till date and has an outstanding loan portfolio of ₹380 crore. The lender operates across 12 states, catering to 34 agricultural value chains.

Samunnati focuses on five broad segments of agriculture—fresh fruits, vegetables and flowers; dairy, poultry and fishery; post-harvest food processing industry; agri inputs such as seeds, fertilizers, agro chemicals, machinery and farm equipment, small and micro irrigation; and field crops and horticulture commodities.

Samunnati’s latest fundraising efforts follow a ₹150 crore equity infusion in January 2018 in a round led by ResponsAbility Investments AG, with participation from existing investors Accel Partners and Elevar Equity. ResponsAbility is a Zurich-based social impact investment firm with more than $3 billion in assets under management.

Emails sent to Samunnati’s founder Anil Kumar, GA and Kotak Mahindra Capital did not elicit any response. Warburg Pincus declined to comment.

For the financial year 2017-18, Samunnati reported a consolidated revenue of ₹140.27 crore, as compared to a revenue of ₹24.43 crore in the previous fiscal, according to the company’s filings with the registrar of companies. It narrowed its consolidated net loss to ₹3.3 crore in 2017-18, from a loss of ₹7.7 crore a year earlier.

Rating agency Icra said in a report in September that Samunnati has witnessed strong growth on the back of its last fundraise, but will need regular funding to maintain its growth rate.

“Aided by the capital infusion (₹150 crore), the company’s managed portfolio, on a consolidated basis, grew more than three-fold (year-on-year) to about ₹342 crore as of June 2018, while maintaining a comfortable capitalization profile (managed gearing of 1.1x). Icra notes that although the current capitalization will be adequate to meet its near-term growth, the company may require regular capital to grow its book at a CAGR (compounded annual growth rate) of 90-100% over the next three years as internal generation is expected to remain relatively moderate,” the report 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.