Grip Invest to invest $100 million in funding battery recycling firms

Grip Invest, an alternative investment platform, plans to invest $100 million over the next five years as it looks to tap opportunities in battery recycling, co-founder and CEO of Grip, Nikhil Aggarwal, told Autocar Professional.

The company has already invested more than Rs 150 crore in the e-mobility ecosystem over the past year and is keen to establish itself in what is a promising business opportunity.

"We are very keen to invest in this space because we're the largest provider of finance to fleets in India,” Aggarwal said adding that Grip’s plans to enable battery recycling companies with funding as it remains a very core part of the EV ecosystem. " We have come across some very interesting companies in early stages who have indicated capabilities to build business models on it and we're looking to work with them," he said.

Funding options

Co-founded in June 2020 by Nikhil Aggarwal, Vivek Gulati, and Aashish Jindal, Grip is backed by prominent venture capital investors and has provided support to the e-mobility and other sectors through asset-backed leasing, inventory finance, startup equity, and subscription-based financing.

Hero Electric, Batterysmart, Euler, IPL Tech, Omega Seiki, Zypp, BluSmart, and Log9 are just a handful of the 40 names with whom Grip already engaged with in the electric mobility domain. The firm's e-mobility segment still gets about 40 percent of its overall capital deployment, he added. At present, it offers them funds in three ways -- leasing assets for a 24 to 36-month period, funding inventory for 1-12 months, and lastly, enabling access to startup equity. 

Grip does not engage in retail finance, a segment which it claims has several customer facing companies and remains highly competitive. 

EV ecosystem financing includes inventories, fast charging stations, battery swapping stations, and battery recycling centres which is a different ball game with legacy banking players and non-banking finance companies (NBFC) having so far kept themselves at a distance from it. However, things are showing a change in recent quarters, albeit not at a pace at which the industry stakeholders may want. For instance, Zypp Electric received Rs 7.6 crore from Northern Arc, an NBFC, in April as part of its plan to deploy 1.5 lakh scooters across the country in three years. 

Complete redesign

Aggarwal said the EV ecosystem still needs over $200 billion in cash because existing systems needs to be completely redesigned from the current ICE infrastructure. The EV market, which is still in its infancy and continues to see many companies struggle with their adopted business models, is also a bigger barrier, in his opinion.

Even though the majority of electric vehicles (EVs) in India currently are two- and three-wheelers, Aggarwal said a shift is underway in the heavy vehicle sectors as well. He cites the examples of electric bus fleets operated by state transportation companies, where he said Grip is steadily gaining ground. For instance, it is funding fast-charging infrastructure for more than 100 e-buses in Ahmedabad.

Aggarwal said the market for 60-tonne electric trucks is promising, underlining the fact that it plays a significant role for companies like Tata Steel, Dalmia, and JSW, among others, who use it for transportation of raw materials. These trucks' supplier, IPL Tech, has been in business for more than three to four years. The Murugappa Group recently purchased a 65 percent stake in the company for Rs 246 crore.