Private equity continues to be the favourite fund-raising channel for micro finance lenders.
Hyderabad-based microfinance institution Bhartiya Samruddhi Finance Ltd (BSFL), part of Vijay Mahajan-led Basix Group, is planning to close another round of private equity funding this year.
BSFL plans to raise $20-25 million funding in the next two to three weeks, its chief financial officer S Ramachandran told VCCircle. This new round follows $10 million raised by the company earlier this year in April.
“We are in talks with mainstream PE players,” Mr Ramachandran said. The company plans to use the funds for expansion. After raising the fresh PE round, it may also look at raising some debt.
BSFL may go for another round of PE funding in June after it exhausts these funds. Intellectual Capital Advisory Services (Intellecap) has been appointed the advisor for the fund-raising.
BSFL raised $10 million from Lok Capital LLC, Aavishkaar Goodwell and Small Industries Development Bank of India (SIDBI) in April 2009. IFC, Shorecap International Ltd, Stichting Hivos-Triodos Fonds, ICICI Bank Limited and HDFC are some of its other existing shareholders.
The MFI has a loan portfolio of Rs 800 crore with 8.5 lakh customers, which will reach 10 lakh by December 2009. It has also expanded its presence in relatively under-served states like Jharkhand, Bihar and the Northeast.