OTO Capital to raise $10 million by March 2021
The funds will be utilised to strengthen its footprint pan-India
Hyderabad: Vehicle leasing company OTO Capital which has raised $2 million (over Rs 14 crore) so far, is planning to raise $10 million (over Rs 70 crore) in Series A round by March 2021. The funds will be utilised to strengthen its footprint pan-India. OTO Capital, which has seen traction in Bengaluru and Pune, has now entered into Hyderabad. The company has leased more than 1,000 two-wheelers since January 2020. Major original equipment manufacturers (OEMs) in the two-wheeler space have started leveraging its online platform.
Sumit Chhazed, co-founder, OTO Capital, said, “We are looking at expanding our presence across the country. We are also exploring leasing models to include three-wheelers and four-wheelers. Logistics is a key segment where we are seeing demand. We want to scale our operations in the two-wheeler segment for the next 18 months and explore new segments.” “We are strengthening our ties with two-wheeler manufacturers. There is also a growing interest among electric vehicle companies to partner with us. We have already tied up with Ampere, Hero Electric and Okinawa and are in discussion with 5-6 other electric vehicle companies,” he informed.
OTO Capital is seeing faster recovery from Covid-19 impact, and has seen 45 per cent performance improvement in its portfolio and collections compared to the industry average. “Two-wheeler segment is a mass volume market, and has good demand in tier-2 and tier-3 towns across India. Besides foraying into New Delhi and Chennai in near future, we will make inroads into all the potential towns and cities in all the States where we have presence, following a hub and spoke model,” he explained.
Hyderabad foray
The company has entered into Hyderabad to offer two-wheelers from all major brands. This is the first time the company will be providing its services through an online model and it has partnered with 45 dealerships in Hyderabad and plans to sign up 50 more showrooms in the next two months.
Hyderabad has been a tech-forward city with a high number of early adopters and millennials who are progressive in nature. The city’s two-wheeler segment has recovered from the economic slowdown faster than Bengaluru and Pune this year, which makes it a key market for OTO Capital, he noted.
Through the company’s leasing model, one can save up to 30 per cent through OTO Monthly Instalments compared to a traditional bank loan EMI. The buyer has complete control over the ownership and can choose to lease the vehicle between one year to three years. At the end of the leasing period, one can also buy back the vehicle from OTO or upgrade to any other vehicle of their choosing.
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