Pragati India Fund investing $6.3M in Lucknow-based PTC Industries
Pragati India Fund, a private equity fund targeting economically underdeveloped and low-income states of India, is picking up a stake in Lucknow-based PTC Industries Ltd, said a source familiar with the development. PTC Industries manufactures customised high alloy castings for application in oil and gas, power and marine sectors.
The source said Pragati India Fund will invest Rs 40 crore in the company. The PE firm is likely to pick up around 20 per cent stake in PTC Industries, which was set up 50 years ago.
Narayanan Shadagopan, managing director of Pragati Equity Advisors, confirmed the investment but declined to comment further on the development. An email sent to Sachin Agarwal, managing director of PTC Industries, did not elicit a response at the time of filing this article.
Crisil was the advisor to PTC on the transaction.
PTC Industries uses a licensed technology which can manufacture large castings with lower weight, better finish and superior quality. The company was set up in 1963 by Sateesh Agarwal, who is the chairman of the company.
PTC Industries has a top-line of around Rs 140 crore and has been growing at 15-20 per cent for the last three years. A majority of the company’s revenues come from exports to markets like Norway, Finland and the US.
The company plans to use the funds to set up a new state-of-the-art manufacturing facility at Lucknow which will manufacture castings of up to 5,000 kgs using the Replicast and RapidCast technologies.
This will be Pragati India Fund's third investment after it backed Indore-based Jash Engineering Ltd, a manufacturer of customised engineering goods for water and wastewater infrastructure sector and Bihar-based non-banking finance company (NBFC) Saija Finance last year.
Pragati India Fund is raising $75 million to $100 million to invest in low-income states such as Bihar, Jharkhand, Uttar Pradesh, Madhya Pradesh, Chhattisgarh and Orissa. These states are home to some 421million people who are defined as ‘multi-dimensionally poor,’ according to the Oxford Poverty and Human Development Index.
Incorporated in 2011, Pragati India Fund is led by Shadagopan, who has worked with organisations like Credit Suisse and Toscafund in New York and London. The fund made a first close at $70 million last year, with commitments from World Bank’s arm International Finance Corporation and CDC Group plc.
(Edited by Joby Puthuparampil Johnson)
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Pragati India Fund is a $100 million private equity fund managed by Pragati India Asset Management. The fund provides venture capital to small and medium enterprises (SMEs) operating in India. The fund seeks to invest in companies with a networth of $10 - $30 million (INR 514.24 million – INR 1.54 billion) at a lock in period of 5-6 years. The fund likes to pick up 25% - 35% stake in its portfolio companies.
PTC Industries Ltd. is engaged in manufacturing of alloy castings. It caters requirement to oil and gas, power and marine sectors. The company was founded in 1963 and is based in Lucknow, Uttar Pradesh.