Fintech firm U GRO capital to raise Rs 340 Cr in equity capital

Lending fintech firm U GRO Capital has announced its second capital raising since its formation in July 2018.

The company’s board approved a preferential allotment of INR 240 Cr to IFU (Investeringsfonden for Udviklingslande) through the Danish Sustainable Development Goals Investment Fund K/S, subject to customary closing conditions, including regulatory and shareholder approvals.

UGRO Capital is simultaneously raising up to INR 101 Cr from long-term shareholders, such as insurance companies, AIFs and other financial institutions through a Qualified Institutions Placement (QIP) of up to INR 101 Cr.

IFU is an independent Danish state-owned fund that offers risk capital to companies in developing countries and emerging markets and is an impact investor that invests to support sustainable development in developing countries and contribute to the realization of the SDGs by creating better opportunities for people in low- and middle-income countries. The growth capital from funds raised will primarily be used for further loans, which will assist the MSME segment and take the credit to the last mile. This capital raising will further strengthen UGRO Capital’s strong capital position and strengthen the balance sheet.

UGRO Capital aims to win a one percent market share with 1 million small businesses. Commenting on the fundraising announcement, Shachindra Nath, Deputy Chairman and Managing Director of UGRO Capital said: “We have seen several FinTech and NBFCs that were created as private entities and then floated in the public market at a significant premium. It was our desire to to create an institutionally owned, independently monitored and professionally managed FinTech in the listed world so that the opportunity is available to the vast universe of public market institutional investors, HNIs, AIFs, PMS and retail investors.”

With this latest capital raising, UGRO Capital is ready to continue its mission to change the lives of small businesses and achieve their goals at an accelerated pace, thanks to a global financial institution for development like IFU as a partner.