The final pricing of the issue is yet to be decided but the funds will be raised over multiple tranches through the next year, the people added.
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Last week, in a board meeting, the directors approved the fundraise, ET has learnt. The company has also approved the appointment of Colin Bryant, chief operating officer (private equity) and general partner at US-based hedge fund, Coatue, to its board. Bryant will be replacing Coatue’s previous nominee, Rahul Kishore, who left the hedge fund in November.
Coatue was the lead investor in BharatPe’s $75 million raise back in 2020, and holds a 13.84% stake, according to research platform Tracxn.
ETtechThe company has also elevated its general counsel, Sumeet Singh, to the position of whole-time director. Singh had joined BharatPe in 2021 and was also responsible for overall corporate strategy, corporate affairs and fundraising.
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BharatPe did not immediately respond to ET’s queries on the developments.
Raising debt
In the past, BharatPe has raised debt from the likes of IIFL Wealth and Northern Arc Capital to fuel its business. It had raised total debt of over Rs 500 crore in 2021 and had plans to borrow Rs 5,823 crore ($700 million) in line with its aspirations to create a loan book of over Rs 8,000 crore ($1 billion) by March 2023.
BharatPe, which provides credit lines to merchants, has facilitated loans worth over Rs 12,400 crore ($1.5 billion) till date, according to data shared by the company recently. It currently has a loan book of over Rs 3,000 crore ($360 million), facilitated through lending partners, and clocked Rs 650 crore ($78 million) in disbursals in October.
BharatPe mostly worked with partner lending institutions to offer credit to its customers. But earlier this year, it acquired a 51% stake in non-banking finance company (NBFC) Trillion Loans. Now, BharatPe needs to raise both equity and debt to expand its credit business.
ET had reported in September that the Peak XV Partners-backed startup had held talks with investors for a fresh, $100 million equity funding round. But the deal has not materialised yet, with conversations getting stuck over the valuation at which the deal can take place. In 2021, BharatPe had raised its last equity round at a valuation of around $2.9 billion.
EBITDA push
The company’s loss before taxes widened to Rs 941 crore in FY23, from Rs 834 crore in the previous fiscal, on a consolidated basis.
Recently, BharatPe announced that October (in FY24) was the company’s first earnings before interest, taxes, depreciation, and amortisation (EBITDA) positive month, and that it is eyeing full-year profitability in FY25.
The company has been operating at an annualised revenue run rate of Rs 1,500 crore, interim chief executive Nalin Negi told ET in November.
BharatPe has also been looking to renew its partnership with Unity Small Finance Bank, in which it holds a 49% stake, and co-create products with the bank.