Piramal Alternatives Invests Rs 600 Crore in Microfinance Firm Annapurna Finance

Piramal Alternatives, the investment arm of the Piramal Group, has committed Rs 600 crore ($75 million) into Annapurna Finance, a leading microfinance company based in Odisha. This investment, announced on Monday, includes a mix of equity and convertible bonds intended to support Annapurna’s growth and diversification strategies.

According to informed sources, Piramal Alternatives has acquired a 9.85% stake in Annapurna for Rs 300 crore through secondary equity transactions. The remaining investment has been directed towards subscribing to tier-2 convertible bonds offered by the microfinance company. This structured capital infusion is expected to enhance Annapurna’s risk-managed growth and expansion of its asset base.

Annapurna Finance, with assets under management exceeding $1.25 billion as of March 31, has made significant strides in diversifying its offerings beyond traditional microfinance. The company now extends its financial services to micro, small, and medium enterprises (MSMEs) and boasts a robust network across 20 states with 1,372 branches nationwide.

Kalpesh Kikani, CEO of Piramal Alternatives, highlighted the robust growth of the microfinance sector, which has seen a compound annual growth rate (CAGR) of 32% over the past decade. Kikani expressed confidence in the sector’s continued high growth trajectory, underscoring the strategic nature of their investment in Annapurna.

Unitus Capital served as the exclusive financial advisor for the transaction, facilitating the investment process.

Gobinda Chandra Pattanaik, Managing Director and CEO of Annapurna Finance, expressed optimism about the impact of Piramal’s investment. “The growth capital from Piramal Alternatives will provide the necessary ammunition for business diversification and help consolidate our leadership position in key markets,” said Pattanaik.