Greater Pacific Capital tops up investment in Muthoot Microfin

 Greater Pacific Capital tops up investment in Muthoot Microfin

Muthoot Microfin, the microfinance arm of Muthoot Pappachan Group, has raised an additional $10 million (Rs 81 crore) private equity investment from Greater Pacific Capital (GPC). This is a follow-on investment by the PE firm that had invested $50 million in the microlender last December.

Post the second round of capital infusion, GPC’s stake in the company has increased to 16.6%. Prior to this round, Creation Investments, a Chicago-based PE firm held 9.8% stake in the company and GPC held 14.4%, rest being held by Trivandrum-based Muthoot Fincorp Ltd. and the Muthoot Pappachan Group family members.

This new investment will help Muthoot Microfin to maintain its growth momentum, expand operations to new geographies and further extend its services to rural households. During FY22, Muthoot Microfin’s AUM grew by 25% and profit surged sixfold. In the first two quarters of current financial year, the company’s asset under management has grown by 20%.

Muthoot Microfin says it is the fourth largest NBFC-MFI in the country with an asset under management of Rs 7,300 crore and 1000 branches spread across 18 states, serving 2.3 million women entrepreneurs. The company focuses on financial inclusion and digital literacy.

Thomas Muthoot, Managing Director of Muthoot Microfin, added: “Post covid, Muthoot Microfin has seen a rapid growth in credit off take. The portfolio originated post the second covid wave (after June 2021), accounting for 80% of the book as on September is behaving very well with just 0.16% NPA. Moreover, the profitability of business and asset quality is improving rapidly. MML is focusing on multiple digital initiatives to bring the operational expenses down. The additional investment will help us leverage on huge growth prospects ahead.”

GPC is an international private equity investor. Founded in 2005, it has invested and mobilised over $1 billion of capital in high-growth companies in core sectors of the Indian economy including financial services, technology and healthcare.

This is GPC’s third investment from its latest fund, alongside investments in Enzen Global Solutions Pvt. Ltd., a provider of energy efficiency solutions to utilities, and Near Pte., a software-as-a-service (SaaS) platform focused on location as a driver of value.

Vivek Sinha

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