Arka Fincap plans ₹525 crore investment from TPG funds

Kirloskar Oil Engines has said that asset management firm TPG will invest an initial ₹525 crore in its lending arm, Arka Fincap, through its The Rise Funds. A further ₹275 crore may be invested in a second tranche, subject to it achieving business milestones and regulatory approvals.

The investment from TPG is expected to provide growth capital to Arka Fincap, to help it deepen its geographical reach and invest in technology and risk management.

Kirloskar Oil currently holds all equity in Arka Financial Holdings (AFHPL) and through AFHPL, holds 90.3 per cent of the equity shareholding in Arka Fincap.

Following the subscription to the first tranche, Kirloskar will, through AFHPL, hold a 68.59 per cent stake in Arka Fincap. This will reduce to 62.61 per cent upon completion of investments under the second tranche.

With assets under management of ₹8,000 crore, Arka Fincap operates across 10 states with 146 branches. It provides pre-owned vehicle loans, secured business loans, loans against property and wholesale lending to medium and small businesses and vehicle operators, through specialised lending services and its expanding branch network.

During the year 2025-26, the company build a secured, retail presence across identified states taking its employee count from 624 at start of the year to 1,800.

Avendus Capital acted as financial advisor and AZB & Partners acted as legal advisors to Arka Fincap on the transaction. Cyril Amarchand Mangaldas acted as legal advisors to TPG on the transaction.