Indian Agritech Arya.ag Secures $81 Million Amid Market Challenges

India’s agritech company, Arya.ag, has successfully raised $81 million in an all-equity Series D funding round led by GEF Capital Partners. This investment highlights the firm’s resilience, as it remains profitable despite declining global crop prices. The funds will enable Arya.ag to expand its operations and technology, further strengthening its position in the agricultural sector.

As global agricultural commodity prices continue to drop, factors such as extreme weather, rising input costs, and trade disruptions pose significant risks to the industry. The World Bank has warned that these challenges leave many businesses vulnerable to price fluctuations and inventory losses. In contrast, Arya.ag has adopted a business model that minimizes exposure to these direct commodity risks. Instead of betting on commodity prices, the company focuses on providing essential services to farmers, allowing them to retain control over their sales.

Founded in 2013 by former ICICI Bank executives Prasanna Rao, Anand Chandra, and Chattanathan Devarajan, Arya.ag aims to empower farmers by offering storage facilities and lending services. The Noida-based startup has developed a network of approximately 12,000 agricultural warehouses across 60% of India’s districts. By allowing farmers to store grain close to their farms, Arya.ag connects them with a diverse range of buyers, helping them avoid the pressure to sell immediately after harvest when prices tend to be lowest.

The company’s impressive scale sets it apart from traditional lenders and agribusiness platforms. Arya.ag aggregates and stores around $3 billion worth of grain annually, which represents approximately 3% of India’s total agricultural output. Additionally, it facilitates around $1.5 billion in loans each year, maintaining a remarkably low rate of bad loans—less than 0.5%—despite the challenges in the market.

Rao explained that Arya.ag’s lending strategy involves offering loans only against a portion of the stored grain’s value. By closely monitoring prices, the company can trigger margin calls if necessary, thereby protecting itself from substantial losses. Borrowers can respond either by repaying part of the loan or by providing additional grain as collateral. Rao emphasized that while risks exist, the company’s approach ensures that it remains insulated from dramatic price drops.

In the financial year ending March 2025, Arya.ag reported net revenue of ₹4.5 billion (approximately $50 million). Revenue for the first half of the current financial year rose by about 30% year-on-year, reaching ₹3 billion (around $33.3 million). The company’s profit after tax for the previous year stood at ₹340 million (around $3.78 million), with a projected increase of 39% for the current year.

Arya.ag currently reaches between 850,000 and 900,000 farmers through its services. It generates revenue from various sources, including storage fees from farmers, loan origination fees from banks, and sales facilitation from buyers. Storage services remain the largest contributor, accounting for approximately 50–55% of total revenue, while financing contributes 25–30%.

The startup disburses over ₹110 billion (about $1.2 billion) in loans to farmers annually, with around ₹25 billion to ₹30 billion (approximately $278 million to $333 million) coming from its own balance sheet through its non-banking finance arm. The remainder is sourced from partnerships with banks, which typically do not service the smaller loan amounts common in rural areas. Arya.ag’s loans carry interest rates between 12.5% and 12.8%, significantly lower than the rates charged by traditional commission agents.

Technology plays a crucial role in Arya.ag’s operations. The company utilizes artificial intelligence to assess grain quality, employs satellite data to monitor crop stress, and uses sensor-enabled storage bags to extend the storage life of grain in areas without formal warehouses. The new funding will support further technological advancements, including the expansion of smart farm centers and the deployment of additional digital tools aimed at enhancing farmers’ operations.

With the recent capital infusion and a commitment to improving profitability, Arya.ag plans to prepare for an initial public offering (IPO) within the next 18 to 20 months. Beyond India, the company has ambitions to expand selectively into international markets, leveraging its software-led model, with some technology already being implemented in parts of Southeast Asia and Africa. Employing over 1,200 full-time staff, Arya.ag is poised for significant growth in the coming years.