Mumbai-based SIDBI Venture Capital has started fundraising for its third India-focused private equity fund, targeting commitments of INR10 billion ($209 million; €150 million).
The fund will make early and growth stage investments across sectors such as renewable and non-conventional energy, power transmission and distribution, clean technology, light engineering, agro and food processing, IT, manufacturing, infrastructure and services, UR Tata, general manager at the firm, said in an interview. He added that the fund will also look at deals social infrastructure-related sectors such as healthcare and education.
“We will select businesses with high scalability which can reach their target customers quickly and cost-effectively,” Tata said. The fund will invest between 50 million and 500 million Indian rupees per transaction, he added.
Parent company SIDBI is the anchor investor and has committed 2 billion Indian rupees to the fund. “There is interest from quite a few domestic financial institutions,” said Tata. The firm expects to see a final close on its fund in about three months.
The firm’s first fund, National Venture Fund for Software and IT Industry, closed on INR1 billion. Parent company SIDBI made an anchor investment of INR500 million in the fund, which is now fully invested.
In 2004, the firm closed the SIDBI SME Growth Fund on INR5 billion. It has made 21 investments from the fund. A major portion of the fund has been deployed and the remainder will be fully committed “in a short while”, Tata said.
SIDBI Venture Capital was established in 1999.