Chennai based Asset Financing NBFC “Mahaveer Finance” raises INR 20 Crs bridge equity through structured funding from Mumbai based Blacksoil Capital (NBFC) before its Series C funding of 100 Crore in the current year. The funds will be utilized to achieve its target AUM of INR 500 Crs for the year.
Founded in 1981, Mahaveer Finance finances used commercial & passenger vehicles through a network of 42 branches which is spread across 3 southern states and 1 Union Territory with dominance in First time Buyer/New to credit vehicle segment. The company has built a strong network of over 35,000 small road transport operators, dealers, agents, and individuals. Low OPEX structure enables them to offer low ticket loans (Rs 3- 4 lakhs) and effectively service them through their branch network. The company has raised over INR 350 Crs of debt from over 26 relationships which are well-diversified with PSU Bank, Private Banks, AIFs & NBFCs. Recently Company has raised INR 50 Crore of TLTRO funding from its PSU Bankers. The company aims to serve the gaps in the used commercial vehicle market retail segment & first-time buyers/new to credit buyers, where most of the large players in used commercial vehicle finance cater to large fleet operators. All loans are secured, livelihood financing enabling self-
employment/micro-entrepreneurship. Typical loan-to-value (LTV) is conservative at 70-80%, which ensures that borrowers have a significant equity investment in the vehicle leading to superior credit outcome. The company has built in-house capabilities for end-to-end process starting from loan origination to recovery. The company claimed to have recorded a 48% year-on-year (YoY) growth from INR 30 Cr in FY15 to a present portfolio of ~INR 300 Crs with over 11,000 active customers.
Mahaveer Finance Promoter Praveen Dugar mentioned that “We heartly appreciate the quick turn-around time, prompt decision making and well supportive team from Black Soil which helped us close this within committed timelines. The fund infusion would strengthen the firm’s balance sheet and will enable us to tap growth opportunities that continue to emerge in the current market towards our larger goal of Rs.2000 Crore in the next 3 years. This transaction will be a stepping-stone for the upcoming Series-C 100 Cr fundraise. After our first round by BanyanTree in 2018, we have grown the book from Rs 50 crores to Rs 300 crores and the current round from BlackSoil will help us achieve Rs 500 crores”.
“The company has established rigorous credit controls, portfolio monitoring systems and loan recovery systems, which reflects in its Gross NPA levels, which is at par with industry benchmarks. The company has also shown strong resilience during Covid times while dealing with the customer segment which was among the most impacted due to the lockdown restrictions. Based on this, we strongly believe in their business model and scalability. We look forward to supporting them in growing their portfolio and expanding their presence”, stated Ankur Bansal, co-founder of Blacksoil Capital.
BlackSoil is a sector agnostic alternative credit platform & has deployed INR 1,100 Crs in the last 4.5 years across 80+ transactions. Blacksoil’s past deals include OYO, Spinny, Purplle, Zetwerks, Vogo, LetsTransport, EarlySalary and iNurture amongst others. Blacksoil has recently raised INR 126 Crores for the first close for its maiden secured Credit Fund.