Aditya Birla Capital Advisors, the private equity arm of the Aditya Birla Financial Services Group, has made its second fund at Rs 220 crore and also made its debut deal by investing Rs 40 crore in SMS Paryavaran, a water and wastewater treatment company.

VCCircle was the first to report in August that the Sunrise Fund would make a first close of over Rs 200 crore and invest in a water management firm.

Sunrise Fund’s investment in New Delhi-based SMS Paryavaran will be for a substantial minority stake and will be used to fund its aggressive growth plans in the backdrop of significant order flow. The company is primarily involved in the construction of public works, such as water transmission, treatment, storage & distribution, sewage system and treatment on turnkey basis. Its clients mainly include municipalities and state governments.

“We believe SMS Paryavaran is a play on using applied technologies for integrated and standalone water treatment and wastewater treatment plants for municipal and industrial customers,” the statement from Aditya Birla Capital said.

The Sunrise Fund

The Aditya Birla Private Equity – Sunrise Fund, which is looking to raise around Rs 350 crore, will target emerging sectors in the Indian economy, such as life skills and applied technologies.

“In view of continued strong patronage of investors, the fund will continue to accept applications in a short window for a limited period and announce its final closing shortly,” said a statement issued by the fund.

The Sunrise Fund will be investing in companies in early cycles of growth and operating across sunrise industries, which are witnessing over 20 per cent compound annual growth rate (CAGR). The Sunrise Fund is expected to focus mainly on four baskets – lifestyle (wellness, processed foods), life care (specialty care & devices, R&D), life skills (education delivery, learning solutions) and applied technologies (cleantech, mobile VAS). It will look at deal sizes, typically between Rs 25 crore and Rs 50 crore, for minority stakes.

“Private equity plays an important role in delivering the commitment of the Aditya Birla Financial Services Group to meet the needs of our target customers. The mobilisation of over Rs 220 crore for our second fund is another strong stride towards fulfilling our ambitious plans in private equity space. The first closing in Sunrise Fund takes our cumulative funds under management to Rs 1,100 crore,” said Ajay Srinivasan, chief executive (financial services), Aditya Birla Group.

The second fund comes after the private equity firm mopped up Rs 880 crore for its debut fund, Aditya Birla Private Equity – Fund I, from domestic investors in March 2010.

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