Aditya Birla Capital Advisors, the private equity (PE) arm of the Aditya Birla Financial Services Group, will close Fund I, its first fund, this month raising about Rs 800 crore. It had earlier announced its first closure at Rs 675 crore by January. The firm had invested Rs 50 crore last month in Anupam Industries Ltd, a Gujarat-based makers of material handling equipment.
Aditya Birla Capital is the first PE arm of an Indian corporate group to close the debut fund successfully. Tata Group and Reliance ADA Group, are in the process of raising their debut PE funds. Tata Capital expects to close the fund-raising for its $350-400 million PE fund in the next six months. Reliance Equity Advisors, the PE arm of Reliance ADAG, was expected to close its first Rs 1,500-crore fund last year.
Bharat Banka, MD & CEO of Aditya Birla Private Equity, said, “We are set to close the fund by this month. We have been given assurance from a few more HNIs and institutions for more investments in our Fund I. Though we have exceeded our earlier expectations of Rs 500 crore in January itself, we have waited two more months for further investments from our domestic sources who have already committed.” The promoter group has committed about 20% to the fund.
It had made three investments—V-Mart, Bombay Stock Exchange (BSE) and Core Projects & Technologies—in the first half of 2008 from its earlier seed capital fund, Naman Capital. The investments made under Naman will be transferred in Aditya Birla PE (ABPE) in the near future.
Sectors like infrastructure, education and healthcare will be given priority as far as the investments are concerned. In the next five years, India will witness a huge investments in the infrastructure space with an immense support from the government. Though there will be good returns expected from pure infra companies, there might be delay for recovering the money. “We prefer infra-related companies such as component suppliers, which can recover money immediately without delay. We have identified a few medical diagnostic companies with innovative ideas, a kind of 'shop in shop,' where the labs being set up in hospital chains under a contract agreement and investments done in medical equipment only while the space is provided by the hospitals at free of cost,” Banka said. The PE firm is expected to make 12-15 investments from the Fund I. We may start planning for next fund by middle of next year, Banka added.
Source: Financial Express