Indgrowth Capital, a public markets-focussed fund founded by former India Build Out fund (IBOF) executives, has hired former TPG Growth partner Varun Kapur as managing partner.
Rajesh Singhal, Indgrowth founder and also a managing partner, told VCCircle that he and Kapur will jointly lead the investment team.
Kapur was heading TPG Growth India till 2014 when the firm went through a management shake-up in the country. He quit the firm subsequently. He was formerly the head of Asia investments at Intel Capital and a managing partner at AIG Investments.
Singhal said Indgrowth Capital has two other members, Saurabh Khandelwal and Aayam Banerjee, who were formerly at IBOF.
The firm is in the process of floating its maiden offering with a target corpus of around $100 million (Rs 670 crore). Singhal said it is awaiting regulatory approval and will soon be ready to receive commitments from limited partners. It has begun soft marketing for this fund, he said.
Singhal and Kapur would need to contribute 5% of the corpus or Rs 10 crore, whichever is lower, for the fund, as per regulatory norms for PE funds.
Kapur’s move to Indgrowth Capital was first reported by the Mint newspaper earlier on Friday.
Meanwhile, Singhal is also overseeing the exit process at IBOF, which is looking to sell its stake in Capricorn Foods.
“We expect to return 2.6 to 2.7 times multiple on our initial corpus of Rs 430 crore, with an internal rate of return of around 23%,” Singhal said.
Unlike IBOF, Indgrowth Capital’s new fund will focus on public market equities. It will invest in the range of Rs 30 crore to Rs 50 crore.
The new fund will be sector-agnostic and expects to tap into listed companies which are typically not covered by analysts, Singhal said.
He also said that, on average, the broad market valuations look expensive but that the fund expects to seek listed companies still on the growth mode in the small and mid-cap segment.
Public market-focussed funds have recently gained in popularity. Last year, former ChrysCapital managing partner Gulpreet Kohli launched Mylen Investment, which is nearly deployed and has built a portfolio of around 15 companies.
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