Vivriti Capital Limited August 2023 NCD Public Issue Review

5 min read • Updated 1 September 2023
Written by Darshan Maheshwari

Vivriti Capital Limited has launched its public issue of NCDs to mobilise funds from the debt market. Read further to know more about the business of Vivriti Capital Limited.

IssuerVivriti Capital Limited
Type of InstrumentListed, Secured, Redeemable, Non-Convertible Debentures
Issue Size Rs. 250 crs + Rs. 250 crs (Green shoe option)
Face ValueRs. 1,000 each
Tenure18 months to 24 months
Yield9.98% to 10.49%
Application sizeMinimum 10 NCDs and in multiples of 1 NCD thereafter
Security CoverMinimum 100% security cover of the principal outstanding plus interest thereon
Credit RatingCARE A/Positive and ICRA A/Stable
Issue Open Date18-August-23
Issue Close Date31-August-23

Specified terms of the NCD’s are as follows*:

A close-up of a document

*All the above NCD’s are secured and do not have an enabling call or put option.

About the Vivriti Capital Limited

Previously known as Vivriti Capital Private Limited, Vivriti Capital Limited (“VCL”) was incorporated in 2017 by Mr. Vineet Sukumar and Mr. Gaurav Kumar. VCL is registered as an NBFC-ND-SI and is the parent company of Vivriti Asset Management Private Limited and CredAvenue Private Limited. The company on a standalone basis is primarily engaged in offering lending products to mid-corporates which includes products like term loans, working capital demand loans, co-lending with financial partners, securitisation of receivables, direct assignment of receivables, supply chain finance and subscription to bonds and commercial paper. The target segment of the company comprises of entities which are either unrated or have ratings that do not permit them to have easy access to banking finance, and primarily hailing from urban/ semi-urban areas.

About the Group

Over the years, the Vivriti group has established its presence in mid-market lending by enabling debt to hundreds of mid-market enterprises across the country. The group is comprised of 7 subsidiaries as of March 31, 2023. The revenue from operation of the company was ₹ 688.08 crs for the year March 31, 2023, and ₹ 404.97 crs for the year March 31, 2022, on a consolidated basis. The company earned profit of ₹ (121.70) crs for the year ended March 31, 2023, and ₹ 1,553.27 crs for the year ended March 31, 2022, on a consolidated basis. The profit is after the consideration of loss on account of ‘share of loss equity from associate’ amounting to ₹ (256.59) crs for the year ended March 31, 2023 and gain due to dilution of control amounting to ₹ 2,007 crs for the year ended March 31, 2022.

VCL is promoted by Mr. Vineet Sukumar (Ex-Northern Arc) and Mr. Gaurav Kumar (Ex-Northern Arc) and holds 6.83% and 6.72% of equity respectively on diluted basis. The company is also backed by foreign VC’s like Lightrock and AIF’s like TVS Shriram. The holding of Vivriti group is described in the chart below:

A diagram of a company's companyDescription automatically generated

History of Vivriti Capital Limited

Vivriti Capital Limited was incorporated on June 22, 2017, under the name Vivriti Capital Private Limited. With effect from June 09, 2023, the company has converted itself from private company to public company (“Vivriti Capital Limited”).

Vivriti group operates through various entities offering a bouquet of products including loans, wealth management, technology etc. Following table provides a brief understanding of the entities and their businesses:

EntityProduct/BusinessIncorporation
Vivriti Capital LimitedTerm loans and Working capital loanJune 2017
Vivriti Asset Management Private LimitedAIFFebruary 2019
CredAvenue Private LimitedTechnology for debt marketAugust 2020
CredAvenue Securities Private LimitedAuxiliary financial servicesJune 2021
Spocto Solutions Private LimitedDigital debt collection technologyFebruary 2020
Finfort Infotech LLPData aggregation and credit underwriting technologyMay 2016
Bluevine Technologies Private LimitedOperates – “corpository.comOctober 2015
CredAvenue Spocto Technology LimitedForeign subsidiary

Financial Performance (at consolidated level)

ParticularsFY23FY22FY21
Net Worth2,8042,687781
Borrowings5,0263,5571,387
PAT(122)1,55314
PAT margin(17.69%)65.33%5.87%
Debt to Equity1.701.211.78

* Debt equity = (Borrowings – Bank Overdraft – Unamortised expense) / Equity (including preference). **The loss for Mar 2023 includes loss incurred due to share of loss of equity from associate amounting    to ₹ 257 crs. The profit for Mar 22 includes profit on dilution of control amounting to ₹ 2,007 crs.

Financial Performance (at standalone level)

ParticularsFY23FY22FY21
Net Worth1,5641,196797
AUM5,8363,8171,905
Borrowings5,0203,5501,368
PAT1296730
PAT margin19.80%19.53%13.68%
Debt to Equity3.072.761.72

*Debt equity = (Borrowings – Bank Overdraft – Unamortised expense) / Equity (including preference)

CRAR of NBFCs in the group

Name of the NBFCMinimum Regulatory CRARCRAR as of March 31, 2021CRAR as of March 31, 2022CRAR as of March 31, 2023
Vivriti Capital Limited15%40.31%29.57%25.74%

Borrowings of the NBFC

Top 10 NCD holders as of June 2023:

S.NoName of holderCategory of holderFace value of holding in INR CroresHolding as % of total outstanding NCD of the Issuer
1.Standard Chartered BankBank-Foreign Commercial Bank100.007.55%
2.CredAvenue Securities Pvt LtdCorporate Body-Domestic92.166.95%
3.Nippon Mutual FundMutual Funds – MF58.504.41%
4.Kotak Mutual FundMutual Funds – MF50.003.77%
5.JM Financial Products LtdCorporate Body-Domestic50.003.77%
6.Sundaram Finance LtdCorporate Body-Domestic50.003.77%
7.Axis Mutual FundMutual Funds – MF49.003.70%
8.MAS Financial Services LtdCorporate Body-Domestic46.203.49%
9.Karius Shavak DadachanjiResident- Ordinary44.503.36%
10.Shyam Metallics & Energy LtdCorporate Body-Domestic40.003.02%
Total580.3643.79%

Nature of Borrowings

Nature of BorrowingsJune 23FY23FY22
Secured  4,994.944,972.823,473.45
Unsecured    43.0053.0483.58
Total  5,037.94 5,025.863,557.03

Type of Borrowings

Type of borrowingJune 23FY23FY22
Bank Borrowings2,720.722,860.381,888.80
Debt Securities1,485.521,518.871077.41
Subordinated Debt
Other Borrowings831.71646.60590.82
Total5,037.945,025.863,557.03

Peer Comparison* (March 2023)

ParticularsVivriti CapitalNorthern ArcMAS Financial
Revenue from operations6881,305988
PAT(122)242206
Net Worth2,8042,0671,545
AUM5,8369,0368,092
ROE**(4.43) %13.11%14.35%
ROA**(1.44) %2.58%2.57%

*Consolidated                                                                                                                                                       **ROE & ROA have been calculated. ROE = PAT/ (Average of net worth for 2 years). ROA = PAT/ Total assets 

Rating AgencyVivriti CapitalNorthern ArcMAS Financial
CRISILNot RatedNot RatedNot Rated
ICRAA/PositiveAA-/StableA+/Stable
CAREA/StableNot RatedNot Rated
India RatingsNot RatedA+/StableNot Rated

Conclusion

Comforts:

  • Adequate capitalisation of Vivriti Capital Limited with regular capital infusion from private equity investors
  • Improving scale of operation to an AUM of more than 5000+ crs and consistent improvement in profitability at NBFC level.
  • Comfortable group leverage.
  • Diversified resource profile (From Banks, NBFC, MF etc) 

Concerns:

  • Inconsistent profitability at the consolidated level.
  • Limited track record as the operations have commenced in June 2017. 
  • Non granular portfolio as the company is into wholesale lending.

Was this helpful?

Darshan Maheshwari

Credit Associate
Darshan is an up-and-coming Investment analyst making headway in the field of capital markets. He has completed his Chartered Accountancy and CFA Level 1 exam. He is currently working as a Credit Associate at Wint Wealth.

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