Motilal Oswal Venture Capital Advisors, a wholly owned subsidiary of Motilal Oswal Financial Services, has picked up an undisclosed stake in Indian dairy firm Parag Milk Foods for 600 million Indian rupees ($14 million; €9.1 million).
Parag Milk Foods produces various dairy products under the brand name Gowardhan. The investment will be used to expand the company’s procurement and processing capacity to about 2 million litres of milk per day in the next couple of years.
India's growing population and “increasing consumerism” will boost demand for dairy products, Raamdeo Agrawal, chairman of Motilal Oswal’s private equity unit, said in a statement.
The investment was made out of the $125 million India Business Excellence Fund, which provides growth capital to SMEs operating in diverse sectors and invests between $5-15 million per transaction.
The fund has invested in seven companies so far including AU Financiers, a non-banking finance company; IMP Powers, a manufacturer of electrical equipment and power transformers; Time Technoplast, a producer of polymer products; business process outsourcing company Effort BPO; and RT Outsourcing Services, a provider of technical support and logistics services to companies.
The India Business Excellence Fund closed in December 2007.