ChrysCapital exits from CavinKare with 2X returns

Promoter buys back entire 14% stake from the PE firm

The promoter of diversified FMCG conglomerate CavinKare Pvt. Ltd has bought back the stake held by private equity major, ChrysCapital, in the company. The PE firm had invested around Rs 250 crore four years back for a 14 per cent stake. It has now exited with twice that amount.

The buyout move by CavinKare promoter C K Ranganathan marks ChrysCapital's first full exit from its sixth fund, which entered its harvesting phase. ChrysCapital had invested Rs 250 crore in CavinKare in 2013 and the investment delivered a return of a little over two times in less than four years.

Ranganathan, Chairman & Managing Director of the company, has confirmed the development, adding that he has consolidated his ownership to 100 per cent in the company.

In 2013, CavinKare roped in ChrysCapital at a time when the company was looking to further strengthen its focus on the strategic direction and results.

"The Company has benefited from the value that ChrysCapital has added over the period of its investment," said Ranganathan, who revolutionised the way shampoos were sold in the country. He has created one of the largest homegrown brands in the shampoo market. Over the last few years, CavinKare has also diversified into the dairy, snacks and beverages businesses.

Ranganathan "Chryscap played an excellent catalytic role. They triggered the needed change which led to a wonderful performance."

The Rs 1,350 crore FMCG major started its journey with the iconic Chik Shampoo brand in the 1980s and has risen to become one of India's largest FMCG companies during the last three decades.

Occupying the top three position in the hair wash and hair color market, the company has several Rs 100 crore brands in the hair care space including household names such as Chik, Indica and Meera.

At a time where growth in the personal care space has been muted for most companies, CavinKare grew around 15 per cent during the last few quarters. During the last decade, CavinKare has successfully transformed itself from a pure personal care player to a FMCG conglomerate with interests in the Dairy, Snacks, Food and Beverages businesses. CavinKare has a strong distribution network with the direct coverage of one million outlets across India.