TVS Capital Funds has announced the second close of TVS Shriram Growth Fund 3 after reaching the target corpus of ₹1,000 crore .
“With the latest announcement, we have totally raised more than ₹2,200 crore through three funds,” said Gopal Srinivasan, chairman and managing director, TVS Capital Funds.
“The fund (TVS Shriram Growth Fund 3) has already received commitments of ₹1,100 crore and it has a green-shoe option of another ₹500 crore of which ₹100 crore has been subscribed to The first two investments from the fund were made in Suryoday Small Finance Bank and LEAP India,” he said.
The fund also witnessed strong participation from existing lead and anchor clients, who had invested about twice their Fund 2 commitments. The fund would be deployed in three areas -- financial services, business services and niche areas. “Every year, roughly, the fund will be investing 20% to 25% of its corpus. In the last six months, the fund had already invested about 10% to 12% of its corpus and has been on track. The average investment per firm ranges from ₹50 crore to ₹150 crore,” he said.
On previous funds, he said they were able to get back the capital of ₹600 crore in the first fund and could return about two times the investment of ₹600 crore in the second fund. Asserting that TVS Capital Funds was a long-term player, he said: “We would like to remain with the entrepreneurs for 10 years, unlike seven years in the first two funds.”
He also said they were the first fund to introduce the co-investor model, wherein investors in the fund deployed money alongside the fund in the same venture.
Foray into new areas
Stating that TVS Capital Funds had completed 10 years of operations, he said that the long-term goal was to become an institutionalised platform and make a foray into new areas to maintain business growth.
“It is important that funds are built and created to support the entrepreneurial ecosystem in the country. If more jobs need to be created, there need to be more start-ups, and there need to be investment in these start-ups,” said R. Thyagarajan, founder, Shriram Group and director of TVS Capital Funds. The company is leveraging advanced technologies for institutionalising its practices and thinking of diversifying its product base, said Lakshmi Narayanan, director, TVS Capital Funds.
With this, the company now manages cumulative assets of ₹1,664 crore and is among the largest managers of rupee-denominated, mid-market, private equity capital in India, Mr. Srinivasan said.
