Kinara Capital is seeking to raise about Rs 200 crore from external strategic investors as the non-banking finance company works to address its ongoing debt challenges. According to reports, the company is exploring fresh funding after existing investors indicated they would not participate in an immediate capital infusion.
To manage its repayment obligations, Kinara Capital has entered into a standstill agreement with foreign creditors, providing additional time to restructure debt amounting to Rs 1,150 crore. The agreement, which includes lenders such as ResponsAbility, BlueOrchard, and Symbiotics, will remain in effect until the end of January 2026.
Alongside discussions with overseas lenders, the company is also in the final stages of a one-time settlement with domestic lenders.
The move comes in the wake of delayed payments in the June quarter, which led some lenders to recall their loans and prompted rating agencies to classify the NBFC as being in default. As of June, Kinara Capital owed Rs 1,853 crore to 45 lenders. Despite repaying a portion of these dues, its outstanding debt still exceeds Rs 1,200 crore, owed to 20 lenders.
The company has been focusing on debt resolution while halting new loan disbursements since the beginning of FY26. It previously sold Rs 478 crore worth of stressed assets to an asset reconstruction company in FY25 as part of its efforts to manage rising credit stress.
Kinara Capital, once considered a fast-growing player in the NBFC sector, has been working to stabilise operations following increased credit costs, higher loan write-offs, and a contraction in assets under management over the past financial year. The proposed funding is expected to support the company’s liquidity position as it continues restructuring efforts.
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