SME lender LivFin India raises Rs 50 crore venture debt from Nuvama

Muthoot Capital Services raises Rs 40 crore via debt

LivFin India Private Limited, an SME focussed tech-enabled non-bank finance company (NBFC) has raised Rs 50 crore in the form of venture debt from wealth management firm Nuvama’s venture debt fund, sources aware of the development told Moneycontrol. LivFin is promoted by Rakesh Malhotra and Navneet Kapoor, promoters of SAR Group that has incubated and scaled businesses such as Luminous, LivGuard and LivPure.

The funding, from Nuvama Crossover Yield Opportunities Fund, which has raised around Rs 1,100 crore for venture debt investments, will be disbursed in tranches, the sources said.

LivFin is focused on financing the supply chains (vendors & distributors) of mid-corporates with Rs 200 crore - 2,000 crore revenue. Since inception, LivFin has built lending relationships with more than 40 partners across agriculture, dairy, power and energy storage, e-commerce, manufacturing etc. and has grown to an AUM (assets under management) of Rs 532 crore as on September 30, 2023.

In November 2020, Livfin raised Rs 35 crore from German development finance institution DEG.

“The company is focused on supply chain financing with higher reliance on partnering with corporates with an established track record of operations in the Indian market, who in turn become the lead generation/nodes for Livfin, to source vendors or distributors as potential borrowers. While Livfin provides SCF (supply chain financing) across distributors and vendors of an anchor, majority of the company’s loan portfolio is skewed more towards vendor-based financing,” rating agency Crisil said in a November report.

Crisil added that Livfin’s core product strategy remains short-term revolving SCF carrying an average tenure of 90 days, thus ensuring adequate control over end usage of funds along with higher visibility on borrower’s cash flow.

The rating agency further noted that since inception, the company has reported a cumulative loss of approximately Rs 20 crore, reaching an AUM of Rs 532 crore, which when compared to other similar companies is significantly lower. “The cash burn at the company has remained stable at around Rs 3 crore -4 crore per annum, including tech-related expenses, while the AUM has more than doubled since March 2021,” the report said.

Emails sent to Nuvama and LivFin did not elicit a response.