MSME-focused shadow lender Trucap Finance has announced two deals — buying out the retail MSME book of the Jalandhar-based EZ Capital in a share swap deal and a Rs 105 crore funding in a mix of equity and debt from the Mauritius-based fund Zeal Global.
The city-based NBFC has a loan book of around Rs 500 crore spread across unsecured small-ticket MSME business loans (Rs 270 crore) and Rs 230 crore of gold loans. Its branches are spread across Maharashtra, Delhi-NCR, MP, Goa, Gujarat, and Rajasthan.
The deal with EZ Capital involves taking over the Rs 65-crore MSME retail book along with over 100 people and 10 branches in Punjab and Delhi-NCR, in a share swap deal wherein the promoters of EZ will get 931 shares of Trucap for their every 711 shares. EZ will own 17 per cent of Trucap, Rohan Juneja, the managing director & chief executive of Trucap told PTI on Tuesday.
On funding from Zeal Global, he said the fund is picking up an 8.25 per cent stake in the company for Rs 80 crore through equity and warrants, and the rest through debt.
City-based Trucap has around 450 people and runs 68 branches and is primarily into low ticket (Rs 1.2 lakh) MSME funding and gold loans.
Juneja claimed that the company disburses around Rs 65 crore in loans on average every month.
Rakesh Sethi, chairman of Trucap, said the current funding round once completed will enhance the company’s equity base to around Rs 325 crore.
Trucap has lending relationships with over 30 lenders, including SBI, HDFC, Central Bank of India, Bank of India, and Nabard among others.