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Faering Capital invests in auto finance firm WheelsEMI’s Series B round
Photo Credit: VCCircle

WheelsEMI Pvt. Ltd, a non-banking financial company (NBFC) which provides financing for pre-owned two-wheelers, has raised Rs 100 crore (about $14 million) in a Series B round of funding led by mid-market private equity firm Faering Capital. 

Faering Capital co-founder and managing director Aditya Parekh told Mint that his firm had contributed Rs 64 crore while the rest was pumped in by existing investor Elevar Equity.

WheelsEMI was founded last year by Srinivas Kantheti, former president of Bajaj Auto’s motorcycle business; Ratheesh K Bharathan, former executive at Bajaj Finance; and former Bajaj Auto Finance executives Karunakaran Vadakkepat and CH Phaneendra Kumar

The company had last year raised Rs 23 crore ($3.5 million) in a Series A round of funding from impact investor Elevar Equity, according to VCCEdge, the data research platform of VCCircle. 

As part of the transaction, Elevar Equity managing director Jyotsna Krishnan had joined the board of the company as a director.

WheelsEMI Pvt. Ltd was earlier known as Varadnarayan Savings and Investment Co. Pvt. Ltd. It is currently present in nine cities including Mumbai, Bengaluru and Pune, according to the Mint report.

Faering Capital

Faering Capital is led by Aditya Parekh, the son of HDFC Bank chairman Deepak Parekh, and Sameer Shroff.

In February, VCCircle reported that British development finance institution CDC Group Plc had committed $25 million (Rs 163 crore) to Faering’s second fund.

The International Finance Corporation (IFC) had invested $15 million in the second fund in June. 

Regulatory filings made by the World Bank’s private-sector arm show that the fund was seeking to raise $200 million and had a hard cap of $250 million.

Mint reported that Faering Capital has closed its second fund at $200 million. Shroff told the financial daily that domestic investors make up 70% of the fund while remaining 30% has been raised from overseas investors.

The fund is focussed on providing growth capital to mid-market companies in India in sectors such as financial services, consumer products/services, healthcare and logistics.

The second fund had made investments in Utkarsh Micro Finance, Yellow Diamond chips maker Prataap Snacks, and BookMyForex, according to the report.

Faering Capital had raised around $183 million for its first fund, according to VCCEdge.

Deals in the space

A host of NBFCs have raised funding in the recent past.

Last week, private equity giant Warburg Pincus had led a Rs 520-crore investment in Delhi-based Fusion Microfinance.

In November, Jaipur-based Kogta Financial (India) Ltd had raised Rs 154 crore ($22 million) in a funding round led by Morgan Stanley Private Equity Asia.

In the same month, non-banking financial company Fedbank Financial Services Ltd’s board approved a Rs 168.6 crore investment by homegrown private equity firm True North for 17.4% stake.

In October, TPG Growth led a $42 million (Rs 311 crore) funding round in non-banking financial company Ess Kay Fincorp Ltd. TPG Growth is the growth capital arm of US private equity firm TPG Global.

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