Warbug Pincus investment to help Vistaar achieve AUM of Rs 5,000 crore: CEO

$250 million investment by global PE Warburg Pincus in Vistaar Focused MSME will help NBFC AUM growth to Rs 5,000 crore in 18-24 months. As of March 2023, the assets under management are Rs. 3,150 crore.

The total capital infusion, which concluded on Monday, includes a contribution from newly appointed CEO Avijit Saha, who will own around 1 percent of NBFC’s stake. Warbug Pincus owns about 95 percent of the shares.

“The capital we have secured now will help us reach assets under management of Rs 5,000 crore. Our target is to cross the Rs 5,000 crore mark in the next 18-24 months,” Saha said. business line.

“A large part of Warbug’s investment is secondary, so all of the previous investors have left, and the early founding leaders will continue to act as advisors for some time. We’re well-capitalized, though we may need more money as we grow.”

A future capital raise could include either Warbug Pincus taking a larger stake in the company or acquiring other investors as minority stakeholders.

Also read: The next stage of growth. Warburg Pincus acquires majority stake in Vistaar Finance

Saha said Warbug Pincus was looking at NBFC in the MSME sector given the rapid growth and potential of the sector, while the founders of Vistaar Finance were looking to step down after running the business for 13 years.

“For them, if Vistaar is to take it to the next level, it needs a partner with big pockets, patience and a long-term perspective on the industry; Warbug Pincus is one of the best long-term partners for that,” said Saha.

Vistaar Finance has a strong platform, distribution channel, good product range, branch network and strong leadership team. The company has also built strong operations around assembly and products.

The company aims to expand the network to 250 branches by the end of FY24. Currently, about 20 percent of the company’s business comes through partners, and 80 percent from direct sources.

Saha said that while NBB is not looking at unsecured loans at the moment, it could venture into sectors with some flavor of unsecured lending such as invoice financing for rural and peri-urban markets.

Going forward, Saha’s focus will be on deepening NBFC’s presence by going into more geographic regions and opening more branches in existing regions, diversifying product range and customer segments, building a robust digital platform, and establishing intelligent late payment management to make it more affordable. effective. You will also look to sell more products to existing customers.

Vistaar Finance operates in 12 states and has 40,000 clients. After the deal, the net worth of the company is Rs 1,210 crore and the capital adequacy is at 37 per cent.