Nivara Home Finance Secures $10 Million Funding from Baring Private Equity

Background

Bengaluru-based Nivara Home Finance announced a successful fundraising round of $10 million from Baring Private Equity India in a completely primary round, as revealed on Thursday. The infusion of funds aims to support the company’s expansion initiatives.

Company Overview

Founded in 2015, Nivara Home Finance specializes in providing affordable housing finance solutions targeted at micro-entrepreneurs and salaried individuals. The company, established by CV Rao along with co-founders Sunil Rohokale and Monik Koticha, initially relied on bootstrap funding, injecting ₹100 crore into the business over time.

Market Focus

Nivara Home Finance distinguishes itself by offering loans with ticket sizes typically ranging from ₹5-7.5 lakh, catering to an underserved segment. Unlike many peers in the affordable housing finance sector, which primarily focus on larger ticket sizes of ₹9-10 lakh or more, Nivara targets Tier 2, 3, and 4 markets.

Growth Prospects

CV Rao, MD & CEO of Nivara, expressed optimism about the potential of the underserved market segment the company operates in. He emphasized the significance of the funding round in strengthening Nivara’s position in this niche and accelerating its growth trajectory.

Operational Footprint

Nivara Home Finance operates across five states, namely Karnataka, Tamil Nadu, Andhra Pradesh, Telangana, and Maharashtra, leveraging a network of 63 branches. The company manages assets worth ₹500 crore, boasting a gross non-performing asset ratio of 0.58% as of February 2024.

Investor Perspective

Debanshi Basu, senior principal at Baring Private Equity India, highlighted the growth prospects of the affordable housing finance sector. Basu praised Nivara’s focus on asset quality, commitment to underserved segments, and the management team’s expertise and governance practices, forecasting sustained growth for the company.

Transaction Details

Ernst & Young played a pivotal role as the exclusive financial advisor to Nivara Home Finance for facilitating this transaction, underlining the significance of the collaboration in securing funding for the company’s strategic initiatives.