Ess Kay Fincorp raises $33 million to fuel expansion plans2 min read . Updated: 26 Nov 2019, 06:37 PM IST
- Ess Kay Fincorp Ltd plans to invest the latest funds towards expanding its geographical presence and improving its services
- EssKay facilitates purchase of used commercial vehicles, tractors, cars and two-wheelers, mainly to low-income, self-employed individuals
MUMBAI : Commercial vehicle financier Ess Kay Fincorp Ltd, on Tuesday, said it has raised $33 million (about ₹235 crore) from its existing investors, US-based mid-market and growth equity platform of alternative asset firm TPG, multi-stage growth investment fund Norwest Venture Partners, and India-focused PE firm Evolvence India, in an internal round of financing.
“Despite the funding challenges faced by NBFCs (non-banking financial companies) in the past 12 months, Ess Kay has been able to raise more than ₹1,500 crore debt from a well-diversified base of investors. Ess Kay has also continued to invest in broadening its leadership team and deepening its geographical presence and now is the largest unlisted vehicle NBFC in North India," said Niren Shah, managing director at Norwest Venture Partners.
“We have great confidence in Ess Kay Fincorp’s leadership team and are delighted to make a significant follow-on investment in this round to support the company’s next phase of growth," said Gaurav Trehan, partner at TPG.
The Rajasthan-based non-bank lender plans to invest the latest funds towards expanding its geographical presence and improving its services. “Since our last equity round, despite tight market conditions, we have continued to march towards our goal and capitalize on the platform built over the last 25 years by focusing on our niche and demonstrating the resilience of our business model. This equity infusion, along with the right strategy, will not only propel our growth but will also further cement our position in terms of our footprint, services and technology vis-a-vis our competition," said Rajendra Setia, managing director and chief executive of Ess Kay Fincorp.
“In next five years, we want to further expand our presence through active diversification strategy in states of Chhattisgarh, Himachal, Uttarakhand, Delhi and NCR," he added.
Founded in 1994 by first-generation entrepreneur Setia, EssKay facilitates purchase of used commercial vehicles, tractors, cars and two-wheelers, mainly to low-income, self-employed individuals. Recently, the company has also diversified its product portfolio by entering into mortgage-backed business loans to small and medium enterprises (SMEs).
The firm presently operates in more than 300 locations in Rajasthan, Gujarat, Madhya Pradesh, Maharashtra, Punjab and Haryana, across 262 branches, of which 154 are in Rajasthan. It has over 1.30 lakh customers and a loan book of ₹2,500 crore.
In November last year, TPG Group had led a $42 million investment in Ess Kay Corp. Its existing investors Norwest Venture Partners and Evolvence India Fund II had also participated in the funding round at the time, Mint reported on 1 November.
In January last year, Norwest Venture Partners, Baring Private Equity India and Evolvence India had led a $32 million equity investment in the company. In 2012, PE firm BanyanTree Growth Capital invested ₹18 crore in Ess Kay.