ChrysCapital invests $45M in CavinKare

Private equity major ChrysCapital has invested $45 million (Rs 250 crore) into Chennai-based personal care products maker CavinKare Pvt Ltd, which makes hair and skin care products such as Chik, Spinz and Nyle. However, the stake dilution had not been disclosed by the company or the investor.

JM Financial acted as the financial advisor to CavinKare in this deal.

Last month, VCCircle reported that ChrysCapital was close to investing in the company and might acquire as much as 14 per cent stake.

Commenting on the funding, CK Ranganathan, chairman and managing director at CavinKare, said, “The investment from ChrysCapital will give a financial boost to the company, given the expansion undertaken over the past few years. Our objective is to grow the company’s brand portfolio a few notches upwards across different markets.”

This money raised will be used to expand the company’s existing brand portfolio, ranging from shampoos, fairness cream, hair colours and deodorants to dairy products, snacks, food & beverages, a company release said.

Gulpreet Kohli of ChrysCapital, who joins the board of the company, said, “The FMCG market in India is now looking at growth with its size and demographic potential.”

CavinKare, a Rs 1,200 crore firm, is a diversified FMCG company with brands across personal care, dairy products, snacks and food & beverages. The brand portfolio consists of shampoos (Chik, Meera, and Nyle), fairness creams (Fairever), deodorant and talc (Spinz), hair colours (Indica), dairy (Cavin’s), food & snacks (Ruchi, Chinni’s & Garden) and beverages (Maa).

Indian consumer sector has seen a lot of traction from large PE firms over the past few years. Only last month, Gurgaon-based Hector Beverages Pvt Ltd raised $8 million in its second round of funding. The investment was led by Sequoia Capital, with participation from existing investors – Infosys co-founder Narayan Murthy’s fund Catamaran Ventures and Footprint Ventures. In February this year, Temasek picked up stake in Godrej Consumer Products for $135 million. Last year, GIC Singapore and Baring India also invested in Marico.

In addition, Dabur India (Baring India) and Jyothy Laboratories (MCap Fund) also saw PE investors buying up stake from the open market.

There have been some deals in this space involving smaller private players as well. While Peepul Capital bought stake in Vishal Personal Care, which manufactures and distributes herbal cosmetics under the brand Banjara’s, Reliance Equity Advisors invested Rs 136 crore in VVF Ltd, which manufactures and markets personal care products.

ChrysCapital has $2.5 billion AUM across multiple funds, focusing on different sectors in India such as consumer goods, financial services, healthcare, business services, pharmaceuticals and infrastructure. In March this year, VCCircle reported that the private equity major picked up stake in drug-maker Ipca Laboratories Ltd from the markets. The firm also acquired up to 4 per cent stake in the Mumbai-based company for approximately $40 million.

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