News
Kogta Financial Raises Series E Investment from Ontario Teachers’ Pension Plan
Mumbai, India, June 26, 2024: Kogta Financial (India) Limited (“Kogta” or “the Company”), a fast-growing retail-focused NBFC specializing in the secured vehicle and MSME finance space, is pleased to announce that Ontario Teachers’ Pension Plan Board (“Ontario Teachers’”) has acquired a significant minority stake by investing INR 1,230 Cr (USD 148 Mn). Kogta has a strong track record of institutional backing with existing investments from funds managed by Creador IV LP (“Creador”), Morgan Stanley Private Equity Asia (“Morgan Stanley”) and Multiples Alternate Assets Private Ltd (“Multiples”). The funds raised will be used as primary capital to drive growth in its product offering and expand regional presence and will also provide partial exits to Kogta’s existing institutional investors, Morgan Stanley and Creador.
Kogta focuses on the large and underserved vehicle financing and MSME lending market. Started in Rajasthan in 1996, Kogta has now expanded to 10 states in India with over 225 branches and 5,000+ employees. The company has assets under management of ~INR 4,800 Cr across commercial vehicles, passenger vehicles, tractors, construction equipment and MSME lending.
Since its first institutional investment in October 2016, Kogta has grown rapidly with AUM growth of 40%+ CAGR with very strong asset quality, led by founders with strong on-ground operational experience and deep market knowledge. Over the years, the firm has brought in seasoned professionals to scale the business, supported by a culture of “freedom to grow” and system-led meritocratic operations.
As part of the investment, Rahul Mukim, Head of Private Equity India, is set to join Kogta’s board as a nominee of the Ontario Teachers’ Pension Plan.
Kotak Investment Banking was the financial advisor for the transaction.
Speaking at the time, Arun Kogta, MD & CEO of Kogtasaid, “This is a significant milestone for the company, and we are delighted to welcome Ontario Teachers’ on board. Their expertise would help Kogta navigate the next phase of its growth journey, deepening its reach in chosen geographies and product segments. We believe that Ontario Teachers’ investment is a stamp of confidence in the underlying business model built over the years.”
Varun Kogta, ED & CFO of Kogtasaid, “Ontario Teachers’ investment will help improve the strength of our balance sheet and increase the confidence of credit rating agencies and lenders in the company. We would also like to appreciate the contributions of our existing investors (Creador, Morgan Stanley, Multiples and CPP Investments) and look forward to their continued support in the years ahead.”
Deepak Dara, Senior Executive Director and India Head for Teachers Ontario said, “Our investment in Kogta underscores our commitment to identifying and supporting high-growth opportunities in India’s vibrant financial services sector. The used vehicle and livelihood financing segment is significantly underpenetrated, and Arun and Varun have built a scalable business model with a strong focus on asset quality, deep technology orientation and talent. We are excited to partner with them to further accelerate their growth trajectory.”
Cindy Yan, Senior Managing Director, Private Capital, Asia Pacific, for Ontario Teachers He added, “Financial services and non-bank lending finance are global focus sectors in which we have significant expertise. We are pleased to support Kogta Financial in its mission to provide financing solutions to the underserved auto and MSME sectors in India. This investment aligns with our strategy of backing strong management teams in high-growth businesses with a clear competitive advantage.”
Arjun Saigal, Managing Director and Co-Head of Morgan Stanley PE Asia, said, “We were among the early investors in Kogta and have witnessed the company’s evolution into one of the leading lenders in the vehicle finance space. The addition of OTPP further strengthens the capitalization table and reflects the confidence of investors in Kogta’s operations. While we are partially exiting our stake in the current round, we remain shareholders and look forward to continuing our successful partnership with Kogta in its next stage of growth.”
About Kogta Financial (India) Limited
Kogta Financial (India) Ltd is one of the fastest growing NBFCs in the vehicle and MSME finance market. Founded in 1996, Kogta is currently led by next generation leaders along with its experienced and innovative management team. Headquartered in Jaipur, the company has served over 325,000 customers through a network of over 225 branches. For more information, visit https://www.kogta.in/
About Ontario Teachers
The Ontario Teachers’ Pension Plan Board (Ontario Teachers’) is a global investor with net assets of CAD 247.5 billion as of December 31, 2023. We invest in over 50 countries across a broad range of assets including public and private equities, fixed income, credit, commodities, natural resources, infrastructure, real estate and venture growth to provide retirement income for 340,000 working and retired members.
Our more than 450 investment professionals operate in major financial centres around the world and bring deep experience across a wide range of sectors and industries. We are a fully funded defined benefit pension plan and have achieved an annual total fund net return of 9.3% since the plan’s inception in 1990. At Ontario Teachers’, we don’t just invest for returns; we invest to shape a better future for the teachers we serve, the businesses we support and the world we live in. For more information, visit otpp.com and follow us on LinkedIn.
Media Contact:
Kogta Financial
Shobhit Nawal
+91 0141 6767008
s.nawal@kogta.com
Ontario Teachers
Henrietta Dehn / Alisha Prakash
media@otpp.com
Pitchfork Partners
Kishor Barua
+91 95941 60314
kishor.barua@pitchforkpartners.com