Reshamandi’s financial crisis deepens with frozen accounts and legal battles

livemint.com:

BENGALURU : Sometime early last year, agritech startup Reshamandi was riding the funding boom, churning revenues, and eyeing net profitability and expansion. Today, the Bengaluru-based firm finds itself ensnared in a financial crisis, with frozen bank accounts, delayed debt repayments, and mounting legal challenges threatening its survival. The company, a business-to-business marketplace for silk products, has been struggling with delayed debt repayments amid difficulty in raising funding since the middle of last year, characteristic of the struggles in the wider agritech sector.

As of August last year, Reshamandi had delayed repaying dues of over $36 million by 30-40 days, according to reports. This financial strain has now culminated in the freezing of its bank accounts, according to people aware of the development. "We are actively resolving the delays.

These take time," the company said in response to Mint’s queries regarding the frozen accounts, adding that discussions with bankers on debt are underway. Documents accessed by Mint also reveal that debt investors Northern Arc Capital and Aditya Birla Finance Ltd have approached the National Company Law Tribunal (NCLT) against Reshamandi. The company, founded in 2020 by Mayank Tiwari, Saurabh Agarwal, Utkarsh Apoorva, has raised approximately $70 million in capital from investors such as Omnivore, Innoven Capital, Alteria Capital, and Northern Arc.

According to data platform Tracxn, Reshamandi raised its last funding round of $5.6 million in June last year, at a valuation of $74 million. Reshamandi’s revenue increased to ₹414 crore in FY22 from ₹21 crore in FY21. However, its losses widened from ₹2 crore to ₹59 crore during the same period.