Ranjan Pai, Axis Bank may back gold loan startup Rupeek

Manipal Group chairman Ranjan Pai’s investment office Claypond Capital and private sector lender Axis Bank are in talks to invest in gold loan startup Rupeek, according to sources aware of the matter. The round will likely see the valuation of the Accel- and Peak XV Partners-backed firm being cut, they said.

Talks with Axis Bank are in early stages and the new investor consortium is finalising its plans, they said.

“Pai’s office is looking to invest in Rupeek but the amount has not been finalised yet,” said one of the persons. “Axis Bank’s participation will also be key to the deal. The valuation would be around $200-250 million.”


The round will also see existing investors part-sell shares.

According to Registrar of Companies (RoC) filings, Rupeek has raised around Rs 50 crore from asset management firm 360 One Asset, previously known as IIFL Wealth and Asset Management, on March 20, 2024. It’s picking up the new capital at a discount of around 60% from its peak valuation of $600 million in July 2022.

Investor Sentiment Hit
ET first reported on March 15 about a potential down round at Rupeek aided by a slowdown in business and a regulatory crackdown on the sector.

A down round is when a company raises new capital at a lower valuation than in the previous one.

Manipal’s Pai declined to comment. Rupeek’s chief executive officer Sumit Maniyar and Axis Bank didn’t respond to queries.

Axis Bank aims to build deeper integration with Rupeek to develop a doorstep gold loan facility for its customers, similar to that of Federal Bank and others, said the people cited above. The lender has seen a strong uptick in gold loan disbursals already growing at a compounded monthly growth rate of 94% in the last six months of FY24.

“The investment could be part of the partnership that Rupeek is building with Axis Bank for gold lending. The talks are still at an early stage though,” said a person in the know.

According to RBI data, outstanding gold loans in March crossed Rs 1 lakh crore compared with Rs 89,382 crore in the year earlier.

RBI asked IIFL Finance in March to stop offering gold loans to its customers. On May 1, ET reported that the central bank had also raised concerns over gold loan disbursals by banks through fintech partnerships.

“The regulatory environment has had a wider impact on investor sentiment as well as future growth prospects,” a fintech investor aware of the likely deal said. “That’s reflected in new funding valuations.”

The Bengaluru-based startup has also seen a slowdown in disbursals, with assets under management (AUM) remaining almost flat in December last year at Rs 1,659 crore compared with Rs 1,669 crore in March 2023. The asset quality, however, improved with loans due for more than 90 days at 2.3% in December compared with 4.1% nine months earlier.

Since its inception in 2015, Rupeek has raised about $164 million from the likes of Accel, Bertelsmann and others.

PayU-backed Indiagold and Oro Money are among other startups in the sector.

Venture-funded startups like Udaan, Byju’s, ShareChat and PharmEasy have also seen significant drops in valuation owing to macroeconomic changes in the market as well as the realignment of valuation based on growth potential over the past year.

Several well-funded startups such as Swiggy, Pine Labs and Meesho have also seen their US investors readjusting valuations in regulatory filings.