ICICI Venture, an arm of No. 2 Indian lender ICICI Bank, is looking to raise $150-$200 million from overseas investors for its India-focused fund, two sources with direct knowledge of the matter said.
The private equity firm, which manages more than $2 billion of assets, is raising $500 million with an option to raise another $300 million for the fund.
Vishakha Mulye, the chief executive of ICICI Venture, confirmed the company would begin road shows for international investors as early as next week, but declined to give details of the amount of funds it seeks to raise.
"We have already received commitments of $350 million from domestic investors, including institutions and wealthy investors," she told Reuters. "Now, we are commencing the launch to international investors."
ICICI Venture will focus on firms that rely on domestic consumption, and those in the healthcare, education and infrastructure sectors, said Mulye, who is a chartered accountant and has been with ICICI for 17 years.
The total private equity investment in India fell more than 60 percent to $4.4 billion in 2009 from $11.9 billion in 2008, according to VCC Edge, which provides data on merger and acquisitions, and private equity and venture capital deals.
Mulye sees the tide changing.
"The India story is looking better than ever before. Valuations now have become realistic and stable. We think it's the best time to go for investments," she said.
"A ticket size of around $25 million to $30 million for each deal would be a sweet spot for us," she said.
ICICI Venture is also planning to exit some of its earlier investments as market conditions have become more stable.
"We are definitely in the divestment mode from our earlier investments. A few could be through IPOs and others through private placements," Mulye said.
Firms such the private equity unit of Kotak Mahindra Bank, IDFC and ILFS Investment Managers are also planning to exit some of their portfolio companies, encouraged by an 81 percent stock market rally in 2009 after the market slumped by more than half a year earlier.