UGRO Capital, a datatech NBFC focused on MSME lending, completes equity capital raise

UGRO Capital, a Non-Banking Financial Company (NBFC) focused on Micro, Small, and Medium Enterprise (MSME) lending, has completed its latest equity capital raise.

The company announced the allotment of Compulsory Convertible Debentures (CCDs) and warrants totalling Rs 1,265 crore.

The development follows the approval of an equity capital raise of Rs 1,332.66 crore by the Board of Directors during a meeting on May 2, 2024. Shareholders approved this raise on June 1, 2024, amid the backdrop of the Indian general elections.

Who are the investors?

The capital raise saw substantial backing from existing private equity investor Samena Capital, which committed Rs 500 crore through warrants.

Other notable institutional investors include Aregence and several of India’s marquee family offices.

Additionally, UGRO Capital’s founder, board members, and management team also subscribed to the warrants issue. Subscribers have the option to pay 25% of the issue price at the time of allotment, with the remaining amount payable 18 months later.

Leadership comments

Shachindra Nath, Founder and Managing Director of UGRO Capital, said, “Securing this capital raise amidst market ups and downs speaks volumes about the sheer trust our investors have in us. Our aim has always been to build a DataTech driven lending institution that is institutionally owned, independently supervised and professionally managed, accessible to public market investors." 

"We're now closer to our goal of helping all small businesses in India and I have an overwhelming sense of gratitude towards all our investors, partners and the entire UGRO team for making it happen," Nath added.

What does URGO Capital do?

UGRO Capital Limited is a DataTech Lending platform, listed on NSE and BSE, pursuing its mission of "Solving the Unsolved" for the small business credit gap in India, on the back of its formidable distribution reach and its Data-tech approach.

In 2018, Shachindra Nath envisaged and executed the concept of India's first listed startup by acquiring a Rs 40 crore net worth listed NBFC, 'Chokhani Securities Limited', and raised institutional equity capital of Rs 914 crore from investors including TPG - NewQuest, PAG, ADV Capital, Samena Capital, and other domestic family offices and public market investors. 

Continuing its strategic expansion, UGRO Capital raised Rs 340.5 crore last year, including Rs 240 crore from Denmark's government-owned IFU via its Danish Sustainable Development Goals Investment Fund K/S and Rs 100.5 crore from other institutional shareholders through a Qualified Institutions Placement (QIP).

UGRO Capital's current financial and operational status

UGRO Capital has raised a total equity capital commitment of Rs 2,700 crore and has a total debt of Rs 4,643 crore from domestic and global institutions.

The firm has partnered with 13 banks and other financial institutions to facilitate Rs 3,295 crore in co-lending.

It has extended data-driven customized finance solutions to over 78,000 MSMEs across India. Additionally, UGRO Capital announced in May the board approval for acquiring MyShubhLife, an embedded finance platform, for Rs 45 crore, which will now operate as a wholly-owned subsidiary.