UGRO Capital To Raise INR 1,332 Cr Via CCDs & Warrants

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SUMMARY

UGRO said Samena Capital has committed to invest INR 500 Cr through warrants, while UGRO founder, board members and management team have together earmarked INR 16.25 Cr

Other investors such as Aregence and multiple Indian family offices have also committed to invest via CCDs and warrants, the NBFC said

With the board approval for the fundraise, UGRO said it has “effectively locked” the capital required for both the current year's growth and next year's growth

UGRO Capital on Thursday (May 3) said its board has approved raising INR 1,332.66 Cr through compulsorily convertible debentures (CCDs) and warrants.

In a statement, the listed non-banking finance company (NBFC) said that the fundraise would be subject to shareholders’ approval.

UGRO said its existing backer Samena Capital has committed to invest INR 500 Cr through warrants, while UGRO’s founder Shachindra Nath, board members and management team have together earmarked INR 16.25 Cr towards warrants.

Other investors such as Aregence and multiple Indian family offices have also committed to invest via CCDs and warrants, the statement added.

CCDs are debentures which have to be converted to equity after a pre-decided data, while warrants give investors the right to buy a pre-decided number of shares of the issuing company after a specified date.

With the board approval for the fundraise, UGRO said it has “effectively locked” the capital required for both the current year’s growth and next year’s growth.

“The capital raise marks a significant milestone in our journey… Today, India needs more financial institutions like ours, to fulfil the credit gap of more than INR 90 Lakh Cr and I am thankful to all the investors, lenders, colending partners and more importantly all UGROites to make this dream come true,” said Nath.

Earlier in the day, UGRO also said that it will acquire embedded finance startup MyShubhLife in a cash and equity deal at an enterprise valuation of INR 45 Cr.

Founded in 2018 by Nath, UGRO Capital is a lending tech platform listed on the stock exchanges.

Excluding the latest fundraise, UGRO has raised nearly $330 Mn till date. It competes with lending tech startups like Lendingkart, InCred, LoanTap, CredAble, and Money View.

UGRO’s net profit soared 132.83% to INR 32.69 Cr in the quarter ended March 2024 compared to INR 14.04 Cr in the year-ago period. Meanwhile, operating revenue jumped 54.29% to INR 322.41 Cr in the fourth quarter (Q4) of the financial year 2023-24 (FY24) from INR 208.97 Cr in Q4 FY23.

UGRO competes for a piece of the burgeoning Indian lending tech market, which is anticipated to become a $1.3 Tn opportunity by 2030.

Shares of UGRO closed Thursday’s session 7.38% higher at INR 283.55 on the BSE.