Bangalore-based Ujjivan Financial Services, one of India’s major microfinance institutions, has raised Rs 127.9 Crore ($25.5 Million) in its fifth round of equity funding, with two new Foreign Institutional Investors participating in it.
Investors who participated in the fifth round of funding include Lok Capital: Rs.100 Million, Sequoia Capital: Rs.100 Million, Mauritius Unitus Corporation: Rs.25 Million, Elevar Equity: Rs.125 Million, India Financial Inclusion Fund (Caspian Advisors): Rs.200 Million and the two new investors — WCP Mauritius Holdings III (Wolfensohn Capital Partners): Rs.400 Million and FMO (Netherlands Development Finance Company): Rs.326 Million.
Samit Ghosh, managing director, Ujjivan said, “This round of equity funding will make Ujjivan one of the best capitalised MFIs in the country”. With this round of equity funding, the last being in 2009, Ujjivan’s capitalisation has more than doubled to Rs. 2,300 million. Kotak Investment Banking was the advisor for the transaction.
Sanjiv Kapur, managing director, Wolfensohn India Advisors Pvt. Ltd. said, “This is the first investment for Wolfensohn in the Indian microfinance sector, endorsing our faith in the sector and in Ujjivan’s financial inclusion model”.
Sudha Suresh, Ujjivan’s chief financial officer indicated that the additional capital will help increase the loan book from the current Rs. 600 Crore to around Rs.1,600 Crore given the Reserve Bank of India’s 15 percent capital adequacy requirement for NBFC-MFIs.
Ujjivan has a million clients in 20 states including 49 under-banked districts across the country and does not have a presence in Andhra Pradesh. Recently, Ujjivan received the Microfinance Organisation of the Year award and ranked No.1 in the Microfinance Industry as the Best Company to Work for in India.
It started operations in Bangalore in 2005 and is a member of Grameen Network, Bangladesh. Currently, it has 3,600 employees at 302 branches and disbursed loans of over Rs.28 billion with a reported repayment rate of 98 percent.