Agri-logistics Sohan Lal Commodity Management raises Rs 100 crore PE fund to escalate its agri-financing arm by 300%
Delhi-based agri-logistics company, Sohan Lal Commodity Management (SLCM) has raised Rs 100 crore in the fourth round of private equity funding led by US-based Social Venture Fund Creation Investments Capital Management and existing investor Everstone Capital.
In March 2011, Mayfield India and Nexus Venture Partners invested Rs 35.5 crore in SLCM. And in November 2012, the firm raised USD 23.5 million (Rs 129.3 crore) from Everstone Capital Advisors and ICICI Bank for a 25.55 per cent and 6.93 per cent stake, respectively.
Ken Vander Weele, Co-Founder and Partner, Creation Investments Capital Management, says, "We are pleased to enter the agricultural services sector in India via this investment of growth equity in SLCM. SLCM was the first company in this sector to provide financing for its customers via the acquisition of an NBFC and this fits perfectly with our mandate to invest in innovative financial solutions."
Since 2011, Creation has made significant investments in India with shareholding in Equitas Holdings, Eko Financial Services, Grameen Koota, and Sonata Finance.
Utilisation of fund
With Rs 100-crore fund, SLCM plans to escalate its agri-financing initiative Kissandhan and is eyeing a three-fold growth of 300 per cent in loans disbursement by the end of this fiscal. Kissandhan has achieved a total disbursement figure of about Rs 250 crore in its 15 months of existence. The firm also plans to expand the warehouse management network from current 760 to 1,500 warehouses pan-India.
Kissandhan was commercialised with capital infusion of Rs 50 crore. It has disbursed loans through 47 locations across 25 commodities against 9,770 storage receipts with zero NPAs with ticket size ranging from Rs 42 lakh to Rs 5 crore.
Kissandhan has sanctioned and disbursed loans across India covering major States and a large number of commodities including pulses, wheat, chana, castor seed, barley, rice, mustard, mentha etc. The group has impacted about 30,000 farmers till date, based on an internal study.
The Group’s Central Laboratory recently received accreditation from NABL to certify tests and data in commodities segment which will be acceptable in 64 nations across the globe.
Sandeep Sabharwal, Promoter and Group CEO, SLCM says, “Our asset-light business model is our key differentiator that defines us as thought leader in the domain. Using our expertise in scientific warehousing, we are committed to steering the sector to a different horizon of growth in the years to come. We will leverage our operational expertise with the knowledge of creation investments, which we have invested in, and we possess in-depth insight of financial solution providers across Asia and other developing economies.”
Background of SLCM Group
SLCM is an ISO-certified agri-logistics company. It has been handling more than 157 agri-commodities including cotton, barley, bajra, castor seeds, wheat, pulses, maize, spices, aloe vera etc., across India. Today, SLCM manages a technology-enabled network of more than 760 warehouses and 17 cold storages pan-India with a total capacity of over 1.77 MMT spread over 9.66 million square feet area and a throughput of 240 MMT.
Sandeep says, “SLCM is managing assets worth approximately Rs 1,500 crore on a daily basis. In a country like India where post-harvest losses are pegged at 10 per cent, SLCM has been instrumental in devising technology that has cut post-harvest losses to 0.5 per cent irrespective of infrastructure, crop or geographic location. SLCM has devised SOPs which amalgamate technology with agri-domain expertise and allows SLCM to operate any warehouse agnostic of infrastructure, location, weather pattern across any kind of agriculture crop.”