MCap Fund to work in close tandem with IDFC PE, TVS Capital

MCap Fund Advisors, an India-focussed private equity fund with a corpus of $60 million, has said that it will work closely with IDFC Private Equity and TVS Capital for its investments. The fund, which was started by Subbu Subramaniam after exiting from Baring Private Equity India Partners, had initially targeted a corpus of $200 million, but had to cap it at $60 million.

“We had the first close of $60 million during last year and we were hoping to further it during this year. But we have decided to cap it at the first close levels as we did not take much active steps later looking at the macro scenario, ” Subramaniam said. MCap Fund has raised majority of its corpus from West Asia and the rest from the US and Singapore.

The fund, which has already made a couple of investments, has said that they are looking at co-investing with IDFC PE and TVS Capital with focus on BFSI, green energy, retail enablers, infrastructure, IT/ITeS, as well as healthcare and education along with specific listed and PIPE deals.

MCap Fund Advisors has already invested in Jyothy Laboratories and City Union Bank besides another one in green energy sector – ReGen. “We are seeing lot of growth in our focus areas. Co-investing with funds helps us to a large extent and we intend to go further on that,” he added.

When Subramaniam exited Baring Private Equity India Partners, he joined a growing list of private equity professionals stepping out of established funds and starting new funds on their own. Well-know names who have taken that step include Ajay Relan and P R Srinivasan from Citi Venture Capital, Renuka Ramnath from ICICI Venture besides a few others. While Relan has gone on to raise as much as $500 million, Ramnath has raised $400 million. While Subramaniam has managed to raise $60 million, Srinivasan is still on the fund raising mode.

“There were some apprehensions when we met investors, given the economy across the globe. It is a tough market with so many PE players in the fund raising mode. We had to cap our fund size at $60 million after seeing the response from a slew of investors we met,” Subramaniam added.