From Local NBFC to Global Contender: SCML’s Fundraising Pivot

Introduction

Standard Capital Markets Limited (SCML), a registered Non-Banking Financial Company (NBFC) under the Reserve Bank of India, recently made a strategic move that has turned heads across the financial sector. Often overshadowed by its sub-₹1 share price, SCML demonstrates that market value does not always reflect a company’s underlying potential. With a fresh infusion of ₹79 crore via non-convertible debentures (NCDs) on a private placement basis, the company is positioning itself for a more ambitious and forward-looking trajectory. (Source: LiveMint)

Major Fundraising Through Private NCDs

On May 6, 2025, SCML announced the allotment of 7,900 unrated, unlisted, secured NCDs of ₹1 lakh each, amounting to a total of ₹79 crore. This follows another fundraising initiative just a day prior, on May 5, where the company issued 12,100 NCDs worth ₹121 crore. (Source: LiveMint)

These consecutive private placements, totalling ₹200 crore within 48 hours, are not mere routine transactions. They indicate aggressive capital mobilisation efforts and underscore SCML’s confidence in leveraging debt to fuel future operations. Even though unrated, using secured NCDs suggests the company’s intent to maintain a certain level of financial discipline while attracting investor trust.

What Does This Mean for Investors?

Traditionally, stocks trading at low nominal values have been viewed with scepticism and often dismissed in mainstream investing circles. However, SCML’s recent moves challenge this perception. The ability to raise ₹200 crore without diluting equity shows that institutional or high-net-worth investors are willing to back the company based on its fundamentals and vision.

Investors should note that:

• The company is not simply raising money but securing it through NCDs, assuming debt obligations rather than offloading equity.
• These are secured NCDs, indicating asset backing and an added layer of risk mitigation.
• Despite being unrated, the successful placement suggests confidence in the company’s repayment capabilities.

NBFCs: A Driving Force in India’s Financial Sector

SCML’s progress aligns closely with the evolving role of NBFCs across India’s financial landscape. A recent analysis by Mavenark Advisors highlights how rapidly NBFCs are expanding, surpassing the growth rate of the broader Indian economy. Between FY19 and FY24, NBFC credit grew at a compounded annual growth rate of 12 percent. Their assets under management (AUM) have risen dramatically from just under ₹2 lakh crore at the turn of the millennium to approximately ₹43 lakh crore by the end of FY24.

This surge is not coincidental. NBFCs have carved out a niche by extending credit to underserved population segments, especially in rural and semi-urban India. Unlike banks, which often concentrate on large corporates, infrastructure, and agriculture, NBFCs have directed nearly half of their lending toward retail customers. In fact, in FY24, 48 percent of NBFC credit went to the retail sector, significantly higher than the 34 percent share held by banks in this category. (Source: www.ibef.org)

More importantly, NBFCs play a vital role in financial inclusion. They lend to individuals lacking a formal credit history, such as gig economy workers, self-employed individuals, or those in the informal sector. Their reach into India’s grassroots and flexible lending models has allowed them to bridge credit gaps that traditional banking channels have historically ignored.

The outlook for FY25 is even more promising. As India’s economy gathers momentum and consumer confidence rises, the demand for accessible and diversified credit solutions is set to grow. Companies like SCML are strategically poised to capture this demand, riding the sector’s momentum while expanding their operational footprint.

Global Ambitions: A Glimpse into the Future

SCML is not limiting its ambition to the domestic sphere. The company’s board has also indicated interest in exploring opportunities in the global financial markets. This includes expanding its financial services footprint internationally, which, if executed effectively, could significantly boost both revenue streams and investor sentiment.

This outward-looking posture is crucial when Indian NBFCs actively explore diversification in product offerings and market geographies. With rising digitisation, cross-border financial services are becoming increasingly viable.

Rewriting the Narrative: Not Just a Sub-₹1 Stock

Standard Capital Markets’ stock price may be below ₹1, but using that as the sole metric to judge the company’s value would be shortsighted. With two major NCD issuances, plans for international expansion, and a clear commitment to long-term strategy, SCML is seeking to rebrand itself not through words but through action.

Market participants would do well to observe the trajectory of this NBFC as it attempts to reposition itself through calculated risk and capital deployment. Instead of viewing it through the narrow lens of price-per-share, a closer look at the company’s financial moves and vision reveals a more nuanced story.

Conclusion

Standard Capital Markets strives to break away from the constraints that often limit low-priced stocks. By utilizing structured debt instruments and implementing strategic planning, the company aims to play a more significant role in the Indian and global financial ecosystems. Against the backdrop of India’s rapidly growing non-banking financial company (NBFC) sector, SCML’s development indicates not only a transformation within the company itself but also highlights a larger narrative about how alternative lending institutions are influencing the future of finance in India.

This could be the right time for savvy investors and financial analysts to revisit SCML, not just for what it is today, but for what it is striving to become.

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