Finnov: Premji, Mirae looks at Chinese stake in fintech lender | India business news

BENGALURU: billionaire philanthropist Azim PremiSouth Korea’s PremjiInvest and Mirae Asset Venture Investment, along with other investors, are in talks to acquire a significant stake in digital lender Finnov. The e-lender owns platforms such as KrazyBee and KreditBee. The deal includes companies that infuse $ 30-40 million at a valuation of nearly $ 200 million, two sources knowledgeable about the development said.
Furthermore, the new investors they are also in talks to raise a significant amount of shares held by Chinese backers such as Shunwei Capital and Kunlun, which together hold 35-40% of the company’s capital. Other investors include smartphone maker Xiaomi and Chinese lending company Lexin.
The deal comes after increasing restrictions on Chinese investments in India and will be one of the first transactions involving a potential exit of Chinese shareholders. “The due diligence process has begun. The idea is to cleanse investors of China and make it an Indian-owned company, “said one of the sources mentioned earlier.
A spokesperson for Finnov declined to comment. PremiiInvest’s head TK Kurien and Mirae Asset CEO Ashish Dave also declined to comment on the speculations.
PremjiInvest has supported loan companies such as Shubham Housing and Aditya Birla Capital, while Mirae has invested in major startups such as grocery e-tailer BigBasket and major Ola.
The deal is likely to be the largest funding round in a fintech lender to date in 2020, as many players have seen operations stall due to Covid lockdowns and now face potential impaired assets (NPAs). Finnov has raised about $ 50 million to date, and its supporters also include funds based in the United States and Canada, such as Alpine Investors and adventures of quark.
Founded in 2015, the fintech lender started with student loans but now focuses on loans to young professionals for a period of 1-15 months. Its non-bank financial unit, KrazyBee, saw its total income jump nearly fivefold in fiscal 2020 to Rs 797 crore with profits of Rs 130 crore, according to filings with the rating agency ICRA. , making it one of the fastest growing lenders. But the company suffered in the first quarter ended June 2020, with total income of Rs 41 crore and losses of Rs 63 crore.
But investors are betting that the company can revive its growth now as it did last year, when its total assets under management grew nearly 3 times to around Rs 1,606 crore, according to ICRA. “The gross portfolio shrank to Rs 473 crore as of June 30, 2020, from Rs 957 crore as of March 31, 2020 (Rs 245 crore as of March 31, 2019) due to significantly lower incremental outlays in the first quarter of fiscal year 2021…. the group expects to achieve assets under management (AUM) of around Rs 1,300-1,500 crore by March 2021, ”the filing said.

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