Indian School Finance plans to raise $3035 mn from PE investors

MUMBAI: Indian School Finance Co Pvt. Ltd (ISFC), which lends to companies in the education sector, is looking to raise around $30-35 million (approximately ₹200-230 crore) from private equity investors, said two people aware of the development.

ISFC, a non-banking financial services company (NBFC), founded in 2008, lends to schools and education institutions. It lends to private schools, affordable schools, vocational institutes and coaching classes to help them build their infrastructure such as setting up of computer and science labs, construction of additional floors or wings in existing premises or for implementing teaching delivery methodologies such as digital classrooms.

“ISFC has appointed Deloitte to advise them on their latest fundraising plans and they have started reaching out to investors. They are looking to raise around $30-35 million in this round,” said one of the two people cited above, requesting anonymity as he is not authorised to speak with the media.

The latest fundraising round will comprise of both a primary and a secondary share component, said the second person cited above, also requesting anonymity.

IFSC counts impact investors Grey Matters Capital and Caspian Impact Advisors as its investors. In October 2016, IFSC raised $6 million from Grey Matters Capital.

“We are in process of fundraising and have appointed Deloitte for the same, we will share the relevant details at appropriate time,” said Neeraj Sharma, chief executive officer and managing director at ISFC in an email response to questions on the company’s fundraising plans.

According to filings with the registrar of companies (RoC), ISFC’s gross loan portfolio stood at ₹285.26 crore as of 31 March 2017, with gross non-performing assets (NPA) of ₹4.14 crore. The company reported a profit of ₹4.56 crore in 2016-17.

ISFC has presence in 13 states, with offices in cities such as Hyderabad, Jaipur, Bangalore, Delhi, Pune, Nagpur and Trichy.

Financing education institutions, though a niche sector in the NBFC space, has seen traction lately with investors, with several companies raising funds or out in the market to raise funds.

In September, Mint reported that Thirumeni Finance, an NBFC that operates under the name Varthana and lends to private schools, is in the market to raise about $50 million.