SK Finance Ltd, an Indian NBFC engaged in used and new vehicle financing and secured business loans, said it has raised Rs 1,328 crore ($159.9 million) from existing as well as new investors.
While Norwest Venture Partners, TPG Growth, and Baring Private Equity India reupped in the round, Duro Capital, Axis Alternatives, Ananta Capital, and Mirae Asset Venture Investments (India) joined as new investors.
Motilal Oswal’s private equity firm – MO Alternates Investment Advisors — also participated in the fundraising by pumping in Rs 415 crore for a minority stake.
Founded by Mr Rajendra Kumar Setia in 1994, SK Finance, a vehicle and small business financier, caters to clients primarily in the north-western part of the country, with a special focus on underserved entrepreneurs in rural and semi-urban areas.
In the auto segment, SK Finance provides funding for used and new commercial vehicles, tractors, and two-wheelers.
Last year, DealStreetAsia reported that SK Finance was in talks with several investors to raise about $122 million, as it looks to ramp up operations.
The company last made headlines when it amassed nearly $53 million in its Series F round from IIFL Wealth and other new investors in December 2021. In May of the same year, the company raised about $45.8 million from TPG Growth, Norwest Venture Partners, and Evolvence.
According to media reports, SK Finance is in discussions for an IPO and is targeting to launch the issue later this year. Reports suggest that the anticipated IPO is expected to be in the range of ₹2,000-2,500 crore.
The company claims to have grown at a six-year CAGR (FY17-23) of over 40% and has developed a diversified lending franchise which has helped it raise debt capital at regular intervals.
Rajendra Kumar Setia, Managing Director and CEO of SK Finance, said, “This primary capital infusion will help accelerate our growth through proposed investments in brand, distribution, technology, and people.”
“The used vehicle financing space is significantly underpenetrated, and SK Finance’s customer connect and continuing focus on granular ticket size products has led to a learning curve and scale benefits,” Vinit Mehta, Managing Director and Head of BFSI at MO Alts, said.