Agriculture-focussed non-banking finance company (NBFC) Netafim Agricultural Financing Agency (NAFA) on Monday said it has raised USD 50 million (approximately Rs 340 crore) through equity and external commercial borrowing (ECB) route. The lender, which is a subsidiary of Netafim Singapore, has raised USD 40 million via ECB from both Israel-based investors- Phoenix Group and Cogito Capital, a release said. The deal also marks fresh equity infusion into NAFA, which recently raised USD 9.4 million of tier I Capital from Netafim Singapore and offered exit to the initial equity partners Atmaram Properties & Granite Hill Fund as they had reached their investment horizon, it said.
This is the maiden investment for both Phoenix Group and Cogito Capital in India and NAFA, through acquiring a stake in Netafim Singapore. The raised funds will be utilised effectively for business expansion, enhanced offerings, and to expand horizons in the agri-rural domain. The company would successfully improve its margins as it intends to service the high-cost old debt and bring down the overall cost of funds, the release said. According to NAFA’s Chief Executive Officer Prabhat Chaturvedi, in India, there is a need for diversified credit schemes, along with adequate hand-holding, to provide financial guidance to farmers on investing in agriculture and allied activities.
With this investment, NAFA will further enhance its credit lending portfolio and expand horizons within the agri-rural domain beyond micro-irrigation. We are bullish about our growth and are excited to cater to the capital needs of the agriculture and allied sector, Chaturvedi said. Started its operation in April 2013, NAFA has a presence across Maharashtra, Madhya Pradesh, Chhattisgarh, Gujarat, Tamil Nadu, Karnataka, and Andhra Pradesh. The company has disbursed total loans worth over Rs 1,000 crore to above 10,000 customers as of date.
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