SK Finance, a automobile loan provider has closed an equity round of Rs 1,328 crore as part of the company’s’ plans to leap into next phase of growth across its business operations focused on brand adoption and new talent acquisition.
In a statement, Rajendra Kumar Setia, Managing Director and CEO of SK Finance, said “This primary capital infusion will help accelerate our growth through proposed investments in brand, distribution, technology and people.”
SK Finance Limited, founded by Setia in 1994, is engaged in used and new commercial vehicle loans, car loans, tractor loans, two-wheeler loans, and secured business loans. The lender offers its services to underbanked low-mid-income, self-employed individuals. Further, it boasts around 500 branches and more than 9,600 employees across 12 states and union territories as of September 2023.
“We are pleased to see the significant progress being made by SK Finance since our initial investment in 2018, with the company today emerging as a scaled player in the used vehicle and MSME lending space,.” said Simit Batra, Principal, TPG Growth.
“In addition to developing a robust operational model, the company’s tech-supported business has delivered improved efficiencies. This marks our fourth investment in the company and we are excited to continue our partnership towards the next stage of growth,” Batra added. Previously, the lending firm secured $53 million in its Series F funding round from IIFL Wealth and various new investors in December 2021.
The firm raised approximately $45.8 million, with contributions from TPG Growth, Norwest Venture Partners, and Evolvence earlier, in May the same year.
SK Finance Aims to tap Underserved Vehicle Financing Space
“The used vehicle financing space is significantly underpenetrated, and SK Finance’s customer connect and continuing focus on granular ticket size products has led to a learning curve and scale benefits. We are enthusiastic about collaborating with SK Finance to build a financial institution dedicated to livelihood financing for entrepreneurs nationwide,” said Vinit Mehta, Managing Director and Head of BFSI at MO Alts.
The funding round was raised from existing investors, including Norwest Venture Partners, TPG Growth, and Baring Private Equity India.
The Non-banking financial company investment round also saw participation from incoming investors namely Duro Capital, Axis Alternatives, Ananta Capital, Mirae Asset Venture Investments (India), and Motilal Oswal’s private equity firm, MO Alts—which picked up a minority stake in the company for Rs 415 crore.
