[Funding alert] NBFC firm Kogta Financial raises $111M in Series D round

Jaipur-based Non-banking lender Kogta Financial (India) Ltd said it has raised $111 million (Rs 846 crore) in a Series D round of funding led by Mumbai-based private equity firm Multiples.

Sources privy to the deal revealed that Kogta was valued at 4 times it's net worth — which stood at Rs 596.43 crore in FY 2021 — fetching it a valuation of close to Rs 2,386 crore.

“The funds will be used as primary capital to support Kogta’s continued rapid growth across products and regions and will also provide a full exit to Kogta’s first institutional investor in Series A, IIFL Seed Venture Fund,” the company said in a statement.

Kogta Financial is a retail non-banking financial company (NBFC) based out of Jaipur. It specialises in vehicle and micro, small and medium enterprise (MSME) financing space.

ALSO READ

What are the pros and cons of leveraging NBFCs by MSME Sector?

The NBFC was incorporated in 1996 by Banwari Lal Kogta, Bal Mukund Kogta, and Radha Krishan Kogta in Rajasthan.

It has presence across eight states in more than 175 branches, and has over Rs 2,000 crore worth of assets under management (AUM) across commercial vehicles, passenger vehicles, tractors, and MSME loans.

Nithya Easwaran, Managing Director, Multiples noted, “Kogta’s in-house technology and systems enable it to deliver superior turnaround time to customers, drive productivity, and build customer insights. Arun, Varun, and Nayan have laid the foundation for a high quality retail franchise. We are delighted to partner with them to build a distinctive financial institution in livelihood financing for entrepreneurs across the country.”

Interestingly, Renuka Ramnath promoted Multiples Equityhas been an avid backer of banks and non-bak financial service companies, with the likes of RBL Bank, South Indian Bank, APAC Financial Services, Vastu Housing Finance, and Sanctum Wealth being on its portfolio.

Canada Pension Plan Investment Board, and existing investors — Morgan Stanley Private Equity Asia and Creador IV LP, also participated in this round.

“The investments from Multiples, CPP Investments, Morgan Stanley, and Creador, underpins the faith placed by new and existing investors on Kogta’s business model and financial performance,” Varun Kogta, Executive Director and Chief Financial Officer of Kogta, said.

“The large primary capital infusion will help enhance our balance sheet strength and increase the conviction of credit rating agencies and lenders in the Company,” he added.

Arun Kogta, Managing Director and Chief Executive Officer said the firm’s AUM has grown 2x during the last two years despite COVID-19.  “We see a strong opportunity to grow further to Rs. 5,000 crore in the next two years,” he added.