Chennai-based non-banking financial company (NBFC) Dugar Finance has raised $5 million (₹45 crore) in a Pre-Series A funding round led by HegdInvst, a Category II AIF focused on growth equity investments.
The capital will support the company to scale its secured MSME lending franchise alongside its established vehicle finance business, and to deepen its presence across tier 2-6 underserved semi-urban and rural markets. The fresh capital will be deployed across four key areas: strengthening technology infrastructure, advancing analytics-led underwriting and centralised risk systems, and hiring senior talent across critical functions.
The company has previously raised approximately $18 million (₹160 crore) in structured debt from a mix of domestic and international lenders, including Symbiotics and British International Investment (BII), along with multiple Indian banks in December 2025.
While historically anchored in commercial and passenger vehicle finance, Dugar Finance is expanding its presence in secured MSME lending, with the aim of building a more balanced and diversified loan book across both segments.
“We are entering the next phase of growth, where diversification and institutional disciplined scaling become critical. Vehicle finance gave us a strong foundation, and we are now leveraging that to build a broader secured lending platform,” Ramesh Dugar, Founder and Managing Director, Dugar Finance, said in a statement.
Dugar Finance currently operates across six states and plans to expand to ten states over the next three years, alongside an expansion of its branch network. The company is targeting ₹2,000 crore in AUM in the next 3-4 years, while aiming to maintain current levels of GNPA below 2 per cent and RoA in the 4–5 per cent range; reflecting a continued emphasis on profitable, quality-driven growth, it said.
Beyond capital, HegdInvst will also support Dugar Finance in strengthening its governance framework, access to international capital, and assisting in building their professional management team.