Belstar Microfinance Limited, a subsidiary of Muthoot Finance Limited, has signed definitive agreements to raise primary equity of ₹350 crore from new investor Affirma Capital and existing investors Muthoot Finance and Maj Invest. This equity raise is subject to obtaining required regulatory approvals.

Steady growth

An equity raise by Belstar during these pandemic times is a testimony of their asset quality and sustained efforts in women empowerment, poverty alleviation coupled with community development. Ever since Muthoot Group’s initial capital infusion of ₹55.40 crore in 2016 for 57.16 per cent stake, Belstar has grown leaps and bounds expanding its branch network to 650 in 19 States with over ₹3,100 crore AUM and upgrading its rating from CARE BBB- to CRISIL AA-.

This round of funding is being led by funds advised by Affirma Capital who will invest ₹300 crore out of a total round of ₹350 crore. Affirma Capital manages over $3.5 billion in assets for leading global limited partners and sovereign wealth funds. It is an independent emerging market private equity firm owned and operated by the former senior leadership of Standard Chartered Private Equity. Their previous investments in India include Northern Arc Capital, Mahindra and Mahindra Financial Services, Prodapt Solutions, Travel Boutique Online, Craftsman Automation, Varun Beverages and GMR airports among others.

Also read: Muthoot Finance posts 16% rise in Q1 net profit at Rs 971 cr

George Alexander Muthoot, Managing Director Muthoot Finance said “We are privileged to partner with Affirma Capital in Belstar. This funding will help Belstar to grow its loan book and accomplish its vision of becoming a socially responsible micro finance institution working towards entrepreneurship and economic empowerment of women.”

“We are pleased to welcome a marquee global investor like Affirma Capital joining us in our growth journey. Their investment in Belstar during such a difficult pandemic period validates the large market opportunity in micro finance space and Belstar’s potential to capitalise on the opportunities. At Belstar, we are very passionate about empowering women and helping them build sustainable livelihoods” said Kalpanaa Sankar, MD, Belstar.

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