Annapurna Fin eyes Rs 8,500 cr in assets by March 23; mulls SME credit arm

Gets $15 mn in equity from French investors, total fundraise reaches $100 mn

With fresh capital infusion of $15 million from French financial institution Proparco, Bhubaneshwar-based MFI Annapurna Finance Ltd  expects to grow assets under management (AUM) by over 25 per cent to Rs 8,400-8,500 crore by March 2023.

The micro finance institution (MFI) has raised a total of $100 million in equity from impact investors and financial institutions during the past 15 months. In March 2021, Nuveen Global Impact Fund put in $30 million, followed by $20 million from DEG in November that year and $35 million from Encourage Capital, Accion and existing investor Oikocredit in December 2021.

Annapurna will use the funds to grow its loan book, invest in technology, expand geographically and further its vision of enabling financial inclusion at scale.

Satyajit Das, chief financial officer, AFL, said the latest funding will suffice to support business growth for 18-20 months. After that, the MFI may again have to raise some capital, though the amount may not be that big ($100 million). He did not dwell on the company's valuation. Its Capital Adequacy ratio (CAR) was 29.78 per cent in March 2022, up from 27.71 per cent in March 2021.

Annapurna Finance's AUM stood at about Rs 6,600 crore in March 2022, up from Rs 5,000 crore in March 2021. The lender is expanding laoans to the SME segment. This would be be done through a subsidiary, Das said.  

Asked about the time-line for listing of stock, Das said listing is definitely on cards as it would enable shareholders to exit, but it will depend on aspects like market conditions. There could be secondary sales via private placements.

Gobinda Chandra Pattanaik, Managing Director, Annapurna Finance, said the existing debt partner Proparco is further supporting the firm and is now a partner on the equity side. The MFI continues to invest heavily in tech capabilities and operations to support its financial inclusion goals and larger banking ambitions.