SUMMARY
The transaction will involve a primary share issuance of 100 equity shares and 10,568 CCCPS to Kotak Securities
The deal is expected to close by the end of December 2021
In January 2021, Kotak Securities had launched its maiden Start-up Investment and Engagement Programme
Kotak Securities will acquire 7.5% stake in Delhi-NCR based Entroq Technologies for INR 3 Cr.
Entroq is a financial technology startup, focused on providing a short-curated financial news platform and a social community (Circles) for early-stage investors and millennials.
“Kotak Securities Limited, a subsidiary of Kotak Mahindra Bank Limited, has entered into a definitive agreement with Entroq Technologies Private Limited (ETPL) dated December 17, 2021, for acquiring 7.50% in the total share capital of ETPL,” Kotak Mahindra Bank said in a regulatory filing.
The transaction would involve a primary share issuance of 100 equity shares and 10,568 cumulative compulsorily convertible preference shares (CCCPS) to Kotak Securities for a total cash consideration of INR 3 Cr.
The deal is expected to close by the end of December 2021.
Incorporated in October 2020, directors of Entroq include Dipankar Biswas, Bharat Bhushan and Diptanil Das.
In July this year, Kredent InfoEdge (KIPL), which operates the brands StockEdge and Elearnmarkets, also raised growth capital INR 10 Cr from Kotak Securities Limited to expand its product capabilities and increase the user reach.
Earlier in January, Kotak Securities had launched its maiden Start-up Investment and Engagement Programme. Through this programme, KSL plans to incubate and invest into innovative fintech and technology start-ups. In January 2021, Kotak Securities said that it has set up an exclusive Corporate Development Department (CDD) for this initiative and an initial investment corpus of INR 50 Cr.
Under the programme, it would launch incubation and accelerator programmes, hackathons, networking events, pitching sessions and demo day programmes for early stage start-ups in-house as well as with other incubator or accelerator groups.
Robust Fintech Growth
The fintech and investment tech sectors in India have witnessed a massive growth in the past few years, largely backed by the growing demand amid the pandemic.
Recently, Bengaluru-based fintech startup Uni raised $70 Mn in one of India’s largest Series A funding rounds. The round was led by General Catalyst.
On December 15th, 2021, Varanium NexGen Fund, a fintech-focused venture capital (VC) fund of Varanium Capital announced its final close at INR 140 Cr.
India’s fintech market is currently one of the fastest-growing compared to the rest of the world. The country has the highest fintech adoption rate at 87% against a global average of 64%.
In Q3 2021, fintech startups raised $2.7 Bn in funding. Out of the total 79 deals reported in fintech, about 18% or 14 deals were recorded by the investment tech sector. The sector attracted $200 Mn in funding in Q32021.
The year 2021 has witnessed a flurry of investments into the startup ecosystem, as it also saw the highest number of unicorns with 40 startups touching over a billion-dollar valuation.
As per the Inc42 Plus Data, in 2021 over $39 Bn has been invested in Indian startups, almost 40% of investment (of the total $109 Bn) recorded between 2014 and 11th December 2021.
This strong flow of funds is expected to continue in 2022 as well.
