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Morgan Stanley PE backs Ummeed Housing in latest financial services bet
Photo Credit: Reuters

Morgan Stanley Private Equity Asia has invested in Ummeed Housing Finance Pvt. Ltd, as it continues to pour money into Indian financial services companies.

Gurugram-based Ummeed Housing said in a statement it has raised Rs 164 crore ($23 million) in its Series D funding round from the PE firm and existing investor LGT Lightstone Aspada.

Ummeed Housing is the second Indian company in which Morgan Stanley PE Asia has invested in February. It had invested Rs 190 crore in Centrum Housing Finance Ltd, a unit of Centrum Group, earlier this month.

The twin transactions come at a time when the PE firm is raising its fifth Asia fund. VCCircle reported in September last year that it had raised $366 million for the new vehicle.

Previously, in the financial services segment, the PE firm had invested in Jaipur-based Kogta Financial (India) Ltd, Janalakshmi Financial Services (now Jana Small Finance Bank) and Five Star Business Finance.

Ashutosh Sharma, founder and managing director at Ummeed Housing, said in the statement that the company plans to use the funds to expand in new regions and strengthen its technology platform.

Avendus Capital acted as the sole adviser to Ummeed for the transaction, according to the statement cited by multiple media reports.

Ummeed Housing aims to increase its assets under management from Rs 500 crore to Rs 1,000 crore in the next two years, the statement said.

“Affordable housing finance presents a large untapped opportunity that Ummeed intends to address through its scalable operating model built with the right blend of technology, people and processes,” said Nirav Mehta, managing director at Morgan Stanley Private Equity Asia.

Ummeed Housing was founded in January 2016 by Ashutosh Sharma, who had spent 25 years at Citibank, HSBC and Bank of Montreal. The company provides loans to families with low and informal income. It offers loans ranging from Rs 3 lakh to Rs 25 lakh to buy and build apartments and houses. It also makes loans against property. Haryana, Rajasthan, Uttar Pradesh, and the National Capital Region are its key markets.

In 2018, Ummeed Housing Finance Pvt. Ltd raised Rs 60 crore ($8.3 million) from Zurich-headquartered LGT Impact and Rs 5 crore ($690,000) from existing social-impact investor Lok Capital in a Series C round.

Earlier, it had raised Rs 36 crore in a Series B round from existing investors Lok Capital and Duane Park in May 2017.

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