Motilal Oswal PE raises a record Rs 23 billion for its third fund

Motilal Oswal Private Equity (MOPE) has raised Rs 23 billion for its third fund, the India Business Excellence Fund-III. Investors in the fund includedomestic and global institutions, large family offices and HNIs, besides Motilal Oswal and the investment team.

Vishal Tulsyan, Managing Director & CEO of MOPE, said that the company has raised the third private equity fund (IBEF III) in a short span of time on the back of strong demand from existing and new investors. 

India is witnessing a fast-emerging class of domestic investors that provide the breadth and depth to the Indian private equity industry as a whole. 

MOPE has a strong track-record of exits because of which entrepreneurs in non-metro cities are becoming more open to external private capital. IBEF III will continue to identify and partner with small to mid-size companies in their growth journey to create value for all stakeholders.

BEF III will endeavour to invest in established mid-market businesses with strong growth characteristics, clear and mature business strategy and a leading market position. The fund expects to invest in about 12 to 14 companies, representing adequate diversification as well as a wide exposure to multiple high growth industry sub-segments.

IBEF III has already made three investments in the financial services, consumer and manufacturing segments.

The first investment is with MAS Financial Services, an-NBFC based out of Gujarat with a retail portfolio of 2-wheeler, CV and SME loans (48% of AuM) and on-lending portfolio of loans to other NBFCs and MFIs (52% of AuM). IBEF III invested Rs 1.43 billion in September 2017.

The second investment is with N. Ranga Rao & Sons Private Limited (Cycle brand), a leading Agarbathi Company in India based out of Mysuru.

The third investment is with Happy Forging Limited, a leading forging company and one of the largest Crankshaft manufacturers in India based out of Ludhiana. The company has a forging capacity of 60,000 MT and machining capacity of 20,500 MT which helps serve customers across multiple end-user industries including commercial vehicles, capital equipment, tractors, railways and exports. IBEF III committed Rs 2 billion in September 2018.

IBEF, launched in 2007 is a Rs 5.50 billion fund and is fully invested in 13 portfolio companies across sectors. Out of the thirteen investments it has already made ten exits. 

IBEF II, launched in 2012 is a Rs 10 billion fund and is fully invested in 11 portfolio companies across sectors like financial services, life sciences, niche manufacturing and consumption based sectors.