IL&FS Investment Managers Ltd (IIML), the listed Indian private equity firm with $2.8 billion assets under management, is set to gain from the changed fund-raising scenario as it plans to raise its latest sector-agnostic fund, Tara India Fund IV. The firm will initiate the fund-raising process by the end of this year. IIML is the PE subsidiary of Infrastructure Leasing & Financial Services Ltd (IL&FS).

The fund size is learnt to be in the range of $300-400 million with an investment focus on areas such as infrastructure, consumer services, manufacturing, information technology and pharmaceutical, healthcare service sectors.

Speaking to VCCircle, Archana Hingorani, chief executive officer, IIML said, “The fund-raising mood is changed very much and we are optimistic about our next fund, Tara India Fund IV. We are in talks with our investors and hope to start fund-raising by the end of this year.”

The latest fund raised by IL&FS alone was Tara India Fund III, a $ 225 million. Tara India Fund III, established in 2007, follows its earlier sector agnostic funds, the AIG India Sectoral Equity Fund and the Leverage India Fund. Tara India Fund III invested in Ramky Enviro Engineers Ltd, GSS America Infotech, Quickjet Cargo Airlines, RBS Group and Ramky Infrastructure Ltd. IIML has already committed about 75% of Tara India Fund III so far.

Early this year, IL&FS Investment Managers raised a $658-million Pan Asian Infrastructure Fund jointly with Standard Chartered Bank (SCB), named ‘Standard Chartered IL&FS Asia Infrastructure Growth Fund,.

Its realty funds include ILFS India Reality Fund II ($895 million), which made 24 investments, and IL&FS India Realty Fund I ($525 million) with 17 investments. According to company website, it has other active funds such as South Asian Regional Apex Fund (SARA), a $25-million fund and Leverage India Fund, a $153-million private equity fund.

IL&FS also manages a JV with Milestone Capital Advisors named IL&FS Milestone Realty Advisors Pvt. managing IL&FS Milestone Fund I and IL&FS Milestone Fund II, sized about $126 million and $146 million respectively.

IIML’s portfolio companies such as Electrosteel Integrated and Ramky Infrastructure have filed draft red herring prospectuses for initial public offerings (IPO) with Securities and Exchange Board of India (Sebi).

With a recovery in the global markets, more and more Indian PE are in the process of fund-raising. Last month, VCCircle reported that Indiareit Fund Advisors, promoted by the Piramal Group, was in the process of raising Rs 750 crore Indiareit Domestic Fund Scheme IV including green shoe option of Rs 250 crore. It has already raised Rs 150 crore and is expected to complete the fund-raising in a couple of months. Indiareit also has plans to raise another offshore fund with a size of $250-300 million in the next financial year. Simultaneously, several real estate players are keen on PE fund-raising, a reflection of increasing demand for this form of capital.


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