Startup Deep Dive : Oxyzo Financial Services — the fintech that turned unicorn on its first-ever funding round

On 23 March 2022, Oxyzo Financial Services announced its first-ever external funding round and became a unicorn in the same breath. The Gurugram-based non-banking financial company (NBFC) raised $200 million (about ₹1,527 crore) at a $1 billion valuation — by two independent accounts, the largest Series A round ever raised by an Indian startup, and the first time an Indian company reached unicorn status directly off a Series A.

That combination — no prior institutional cheque, an immediate ten-figure valuation — sounds like the setup for a down round two years later. Instead, Oxyzo kept compounding: by the fiscal year ended March 2026, revenue had grown almost fivefold from its pre-round base to ₹1,494 crore and profit to ₹375 crore, most of it earned lending against invoices and purchase orders to small manufacturers that most banks will not touch.

Quick facts

What they do

Oxyzo is an RBI-registered NBFC that lends working capital to small and mid-sized businesses — mostly manufacturers and traders dealing in steel, chemicals, agri-commodities, polymers and other industrial goods — so they can buy raw material, fulfil a purchase order, or bridge the gap between raising an invoice and getting paid on it. It grew out of OfBusiness, the B2B commerce platform where Mohapatra and Kalra were already selling steel, cement and chemicals to SMEs on credit terms; once that credit book outgrew what belonged on a trading company’s balance sheet, they carved it into a separate, RBI-licensed lender. By FY26 that lender carried assets under management of ₹11,822 crore, up 28% year-on-year, spread across six product lines and serving businesses well beyond OfBusiness’s own customer base.

The origin

Asish Mohapatra, a mechanical engineer from IIT Kharagpur with an MBA from ISB who had spent more than four years as an investor at Matrix Partners, and Ruchi Kalra, an IIT Delhi graduate with an ISB MBA who had spent roughly nine years at McKinsey in Mumbai, founded OfBusiness in August 2015 along with Bhuvan Gupta, Nitin Jain and Vasant Sridhar. The founding insight was narrow but sharp: small manufacturers buying bulk raw material had neither a transparent, efficient way to source it nor the working capital to pay for it upfront, and the two problems were really one problem wearing two hats. If a platform could combine procurement with embedded financing, it would not only serve SMEs better than existing options; the transaction data flowing through the marketplace itself would let it underwrite credit risk faster and more cheaply than a lender working from bank statements alone.

That embedded-credit idea, workable but unproven in 2015, is what eventually became Oxyzo. OfBusiness ran the lending desk internally at first, then spun it into its own entity in 2016. After Oxyzo took its own NBFC licence in November 2017, it began underwriting loans independently of its parent’s commerce book, and it has since grown to a point where, according to Entrackr’s analysis of its 2022 captable, more than 70% of its lending goes to businesses that are not OfBusiness’s own commerce customers — the credit arm has outgrown the errand it was built to run.

The struggle years

The idea that looks obvious in hindsight was rejected, repeatedly, when it mattered. In 2016, pitching a business that mixed commerce and lending, Mohapatra and Kalra were turned down 73 times over six months; investors doubted that a founding team without a specialised lending background could underwrite an SME credit book at scale. They kept pitching because, as Kalra later put it, they just wanted one investor who understood what they were building.

The rejections did not stop once OfBusiness had money in the bank. The group posted a loss of ₹1.14 crore in FY18, and when Mohapatra approached Norwest Venture Partners for its Series D that year, managing director Niren Shah declined. His reasoning was blunt and, in hindsight, prophetic for a business that would soon depend on a lending subsidiary: an unprofitable company gets a worse credit rating, a worse credit rating means costlier debt, and costlier debt chokes the very growth a fundraise is meant to buy. Mohapatra returned four months later with improved profitability metrics, and Norwest came back to lead a ₹250 crore Series D in 2019.

Oxyzo carried its own version of that same problem a few years later. By October 2020, in the middle of the pandemic-driven credit crunch, CARE Ratings had Oxyzo’s bank facilities and non-convertible debentures pegged at CARE BBB+ — solidly investment grade, but only barely, for an NBFC just three years past its licence and entirely dependent on wholesale borrowing to fund the loans it made. A low rating at that particular moment mattered more than at almost any other: cheap funding lines were exactly what was disappearing across India’s NBFC sector, and Oxyzo had to keep collections steady and asset quality clean through the moratorium period to earn its way to a better one. It worked. The rating moved to CARE A+ by October 2021, a full notch-and-a-half up, just months before the Series A round that made the company a unicorn.

The turning point

The single event that changed Oxyzo’s trajectory was that March 2022 round, and the numbers on either side of it tell the story better than the headline valuation does. Going into it, Oxyzo was a modest, profitable lender: FY21 total operating income of ₹197.57 crore, profit after tax of ₹39.94 crore, and a net loan book of ₹1,357 crore, carrying a credit rating that had only just reached A+ the previous October. On 29 March 2022, Oxyzo booked a ₹817.56 crore equity infusion as the first tranche of what became a $200 million round, priced to value the company at $1 billion.

The year the round closed in, FY22, Oxyzo’s total operating income reached ₹313.24 crore and profit after tax ₹69.34 crore — growth that had been building steadily, not a step-change caused by the funding itself. What the capital did change was what came next: with a stronger balance sheet and a credibility marker no SME lender in India had earned before it, Oxyzo’s net loan assets nearly doubled to ₹4,672 crore by FY23, and its assets under management grew 84% year-on-year to ₹4,689 crore. The round did not create the business; it removed the funding ceiling that had been holding back a business that already worked.

The money behind it

• 2016–2021: Oxyzo grew almost entirely on OfBusiness Group capital and internal accruals, without a priced external round, while it built four straight years of profitability and a credit rating strong enough to borrow wholesale (CARE Ratings, 10 August 2023).
• 23 March 2022 – Series A: $200 million (about ₹1,527 crore) at a $1 billion valuation, its first external funding round and, per BusinessToday and Entrackr (both 23 March 2022), the largest Series A round ever raised by an Indian startup.
• Alpha Wave (lead): ₹565 crore for a 7.4% stake (Entrackr captable analysis, 14 July 2022).
• Tiger Global (co-lead): ₹344 crore for a 4.5% stake.
• Norwest Venture Partners (co-lead): ₹290 crore for a 3.8% stake — the same Norwest that had declined to back the group in 2018 over profitability concerns.
• Creation Investments (co-lead): ₹152 crore for a 2.0% stake.
• Matrix Partners (co-lead): ₹145 crore for a 1.9% stake — the firm Mohapatra himself once worked at as an investor.
• Cumulative equity raised since inception stood at about ₹1,960 crore as of FY23, including roughly ₹700 crore raised within FY23 alone (CARE Ratings, 10 August 2023).
• Ownership: OFB Group, the OfBusiness promoter entity, held about 74% of Oxyzo immediately after the Series A and roughly 70% by March 2023 as further capital came in (Entrackr; CARE Ratings, 10 August 2023).
• No new priced round has been publicly reported since March 2022; the $1 billion mark remains Oxyzo’s last confirmed valuation, even as parent OfBusiness prepares to file a draft IPO prospectus around November 2026, reportedly targeting a group valuation of $5–6 billion (Inc42, 5 August 2026).

How it makes money

Oxyzo does not take deposits. As an RBI-registered, non-deposit-accepting NBFC, it borrows wholesale from banks, development finance institutions and bond investors, then re-lends that money to SMEs at a markup, keeping the spread between the two rates. The mechanics are straightforward; the discipline in running them is the actual business.

• Interest income made up 96% of operating revenue in FY24 (₹866 crore of ₹903 crore) and 95% in FY25 (₹1,141 crore of ₹1,207 crore); fees and commissions are a rounding error next to it (Entrackr, 31 May 2024 and 29 May 2025).
• The single biggest cost is the interest Oxyzo itself pays lenders: finance cost rose from ₹317 crore in FY24 to ₹439 crore in FY25, consistently 58–62% of total expenditure in both years (Entrackr).
• The part people get wrong: this is not a business skimming a thin percent or two like a bank. Net interest margin was 7.3% in FY22 and improved to 7.82% in FY23 (CARE Ratings) — closer to what a disciplined microfinance lender earns, because Oxyzo’s SME borrowers are precisely the customers mainstream banks price too cautiously or skip.
• Credit cost — money provisioned or written off against bad loans — stayed low at 0.54% in FY22 and 0.62% in FY23, helped by short tenures (purchase finance runs up to 12 months) that surface trouble early, and by a loan book that was about 74% secured in FY23 (CARE Ratings, 10 August 2023).
• Operating costs are falling as a share of assets: opex ran at 2.42% of assets in FY22 and 2.03% in FY23 (CARE Ratings), the ordinary economics-of-scale story for a book compounding faster than headcount.

The numbers

Four straight fiscal years of higher revenue and higher profit, with growth decelerating as the base gets larger — a pattern typical of a lender scaling off an increasingly bigger book. Figures in ₹ crore.

• FY23 figures are CARE Ratings’ audited numbers (₹561.78 crore revenue, ₹196.51 crore PAT), rounded here for readability (CARE Ratings, 10 August 2023).
• FY24 revenue and profit are from Oxyzo’s RoC filing as reported by Entrackr on 31 May 2024, up 58.4% and 47% respectively on FY23.
• FY25 revenue of ₹1,207 crore and PAT of ₹339 crore are corroborated independently by both Entrackr and Inc42, each published 29 May 2025.
• FY26 revenue of ₹1,494 crore and PAT of ₹375 crore, up 23.8% and 10.6% year-on-year, come from Entrackr’s exclusive report published 29 May 2026, alongside an AUM of ₹11,822 crore, up 28% for the year.
• Profit growth has trailed revenue growth since FY25 (16.5% profit growth against 33.7% revenue growth that year, and roughly 10.6% against 23.8% in FY26) as finance costs rose faster than revenue and the book mix shifted toward longer-tenure business loans.

Where the money comes from

• By product: purchase finance and working-capital lending remain the core, but the business-loan segment (18–30 month tenure) grew from 18% of the loan book in FY22 to 31.55% in FY23 (CARE Ratings, 10 August 2023).
• By security: about 74% of the FY23 loan book was secured lending; the remaining 26% was unsecured lending to MSMEs with an established repayment record (CARE Ratings).
• By geography: as of March 2023, Oxyzo’s book was spread across 20 states, with south India contributing 38% of operations, north India 30% and west India 27% (CARE Ratings, 10 August 2023).
• The surprise: despite being built as OfBusiness’s captive finance arm, more than 70% of Oxyzo’s lending by FY22 already went to businesses outside OfBusiness’s own commerce customer list (Entrackr, 14 July 2022) — the subsidiary now competes as a standalone SME lender rather than merely financing its parent’s marketplace transactions.
• By FY26, the loan book stood at ₹10,545 crore against total AUM of ₹11,822 crore, with net worth of ₹3,327 crore and a capital adequacy ratio of 29% (Entrackr, 29 May 2026) — well above the roughly 15% regulatory floor the RBI sets for NBFCs of Oxyzo’s category.

The risks

• An unseasoned book growing faster than its own track record. CARE Ratings flagged in August 2023 that Oxyzo’s loan book had compounded at an 86% two-year CAGR through FY23, meaning a large share of it had never lived through a full credit downturn. That makes today’s low delinquency numbers a weaker guide to how the book behaves if SME demand or commodity-linked working-capital cycles turn down (CARE Ratings, 10 August 2023).
• Borrower vulnerability to macro shocks. In CARE’s own description, Oxyzo lends to SMEs with “modest credit profiles” that “remain inherently more vulnerable to macro-economic shocks.” The company mitigates rather than eliminates this by keeping around three-quarters of its book secured, but the underlying borrower base is, by design, exactly the segment that struggles first in a slowdown (CARE Ratings, 10 August 2023).
• A capital structure leaning more on debt as it scales. Oxyzo’s capital adequacy ratio slipped from 48.38% in FY22 to 42.65% in FY23 as gearing rose to 1.37x, because loan-book growth was increasingly funded by borrowings rather than fresh equity (CARE Ratings, 10 August 2023). The FY26 capital adequacy ratio of 29% (Entrackr, 29 May 2026) remains comfortable, but the direction of travel, combined with roughly 70% ownership concentrated in the OFB Group and a parent whose core commerce business trades cyclical commodities like steel and agri-products, ties Oxyzo’s capital planning closely to decisions made elsewhere in the group.

The takeaway

The lesson here is not “spin off your captive finance arm and wait for a unicorn round.” It is about sequencing. Oxyzo’s founders built years of profitable, if modest, lending before ever asking a venture investor for a term sheet, and did so only after a rejection in 2018 forced the wider group to prove its numbers could stand on their own without outside capital propping them up. When the money finally came, in March 2022, it was not raised to fund losses; it was raised to fund more of something that already worked, at a moment when that track record could command a valuation that growth alone, without the years of discipline behind it, could not have justified. In a market where the fastest route to a headline number is usually to spend faster than you earn, Oxyzo took the slower path: it made the balance sheet unremarkable long before anyone outside the company was watching it, so that when investors finally looked closely, the unremarkable parts were the entire pitch.

Frequently asked questions

Is Oxyzo Financial Services publicly listed?

No. Oxyzo remains a private, RBI-registered NBFC. Its parent group, OfBusiness, is reportedly preparing to file a draft IPO prospectus around November 2026 for an issue of up to $800 million, but Oxyzo itself has not announced a separate stock market listing (Inc42, 5 August 2026).

Who owns Oxyzo Financial Services?

OFB Group, the promoter entity behind OfBusiness, held about 70% of Oxyzo as of March 2023, with the remainder held mainly by its March 2022 Series A investors: Alpha Wave, Tiger Global, Norwest Venture Partners, Matrix Partners and Creation Investments (CARE Ratings, 10 August 2023; Entrackr, 14 July 2022).

How much funding has Oxyzo raised?

Oxyzo had raised about ₹1,960 crore in cumulative equity since inception as of FY23, the bulk of it through its March 2022 Series A round of $200 million (about ₹1,527 crore) at a $1 billion valuation (CARE Ratings, 10 August 2023; Entrackr and BusinessToday, 23 March 2022).

What is Oxyzo’s revenue and profit?

Operating revenue rose from ₹903 crore in FY24 to ₹1,207 crore in FY25 to ₹1,494 crore in FY26; profit after tax rose from ₹291 crore to ₹339 crore to ₹375 crore over the same three years (Entrackr, 31 May 2024, 29 May 2025 and 29 May 2026).

What does Oxyzo actually lend against?

Mostly purchase orders, invoices and the working-capital needs of small and mid-sized manufacturers and traders, through products including purchase finance, invoice discounting, vendor finance, business loans, machinery finance and loans against property. About three-quarters of its FY23 loan book was secured lending (Oxyzo.in; CARE Ratings, 10 August 2023).

Sources

Figures are as of September 2026. Currency converted at $1 ≈ ₹96.0 as of 18 September 2026 (Trading Economics).

• BusinessToday, “Ofbusiness’s financial services arm Oxyzo turns into a unicorn” — March 2022
• Entrackr, “OfBusiness’ lending arm Oxyzo turns unicorn in largest Series A round” — March 2022
• Entrackr, “Decoding Oxyzo’s unicorn round and captable” — July 2022
• Forbes India, “Asish Mohapatra and Ruchi Kalra: How this power couple spins profitable unicorns” — September 2022
• CARE Ratings, press release on Oxyzo Financial Services Private Limited — August 2023
• Entrackr, “Exclusive: Oxyzo posts Rs 903 Cr revenue and Rs 291 Cr PAT in FY24” — May 2024
• Entrackr, “Exclusive: Oxyzo clocks Rs 340 Cr PAT on Rs 1,207 Cr revenue in FY25” — May 2025
• Inc42, “Oxyzo’s Profit Jumps 17% To INR 339 Cr In FY25” — May 2025
• Entrackr, “Exclusive: Oxyzo records Rs 1,494 Cr revenue and Rs 375 Cr PAT in FY26” — May 2026
• Inc42, “OfBusiness Set To File DRHP For $800 Mn IPO By Mid-November” — August 2026
• Oxyzo.in, “About Oxyzo” company page — accessed September 2026

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