Piramal Alternatives Invests Rs 600 Crore in Microfinance Leader Annapurna Finance

Preeti Bali / 6:24 am / May 14, 2024

Piramal Alternatives, the investment arm of the Piramal Group, has announced a significant investment of Rs 600 crore in Annapurna Finance Private Limited. This strategic infusion of capital aims to propel Annapurna’s growth trajectory and solidify its position as a leading microfinance institution.

The investment structure incorporates a two-pronged approach. Piramal will acquire a 9.85% stake in Annapurna through a secondary share purchase, amounting to Rs 300 crore. Additionally, the remaining Rs 300 crore will be utilized to subscribe to optionally convertible debentures issued by Annapurna. This “structured capital solution,” as described by Piramal Alternatives, is designed to meticulously manage risk while enabling the expansion of Annapurna’s asset base.

Annapurna Finance: A Pan-India Microfinance Powerhouse

Headquartered in Bhubaneswar, Odisha, Annapurna Finance is a prominent NBFC with a core focus on microfinance. Recognizing the critical role microfinance plays in empowering communities, Annapurna actively contributes to financial inclusion across India. To further expand its reach and offerings, the company submitted an application for a universal banking license to the Reserve Bank of India in 2023.

As of March 31, 2024, Annapurna boasts impressive assets under management exceeding $1.25 billion. The company’s extensive network encompasses over 1,372 branches spread across 20 states, covering nearly 450 districts. This widespread presence allows Annapurna to cater to a vast population and contribute meaningfully to their financial well-being.

Investing in the Future: Growth and Consolidation

Commenting on the investment, Gobinda Chandra Pattanaik, Managing Director and CEO of Annapurna Finance, expressed his enthusiasm. He stated that the capital infusion from Piramal Alternatives would serve as a springboard for business diversification and fortify Annapurna’s leadership position in key markets. This growth capital will empower Annapurna to capitalize on new opportunities and solidify its position as a preeminent financial institution.

Experienced Advisor and Strong Backing

Unitus Capital served as the exclusive financial advisor to Annapurna Finance throughout this transaction, demonstrating the expertise involved in structuring this significant investment.

Beyond the recent investment, Annapurna Finance enjoys the support of a prestigious consortium of domestic and international investors. This esteemed group includes Nuveen Global Impact, Oman India Joint Investment Fund, and the Asian Development Bank, among others. This robust backing underscores the confidence placed in Annapurna’s commitment to financial inclusion and its potential for continued success.

By combining Piramal’s strategic investment with Annapurna’s proven track record and established network, this partnership is poised to propel Annapurna’s growth and empower countless individuals across India.

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