Incofin IM today announced the first close of its India Progress Fund (IPF) at Rs 450 crore, the company said in a statement.
The fund will make private equity investments in the agri food value chain and financial services in rural India. The fund has been raised from a diverse set of private and institutional investors including CDC, Proparco, Korys, BIO, and several Belgian family offices and foundations.
IPF will support entrepreneurs through patient capital, mentoring and access to a global network. It will focus on two sectors which make the deepest social impact: financial inclusion and the agri-food value chain.
“The modernisation of the agri value chain and rural financial inclusion is an underinvested opportunity in India with significant potential for rural impact and for creating meaningful enterprises. We are grateful to our investors for enabling us to execute this investment strategy,” said Rahul Rai, partner, Incofin IM.
The complexity and multidimensional characteristic of the financial inclusion and the agri-food value chain sector have somewhat deterred equity investors. Through a sector focused approach and international experience in the sectors, IPF intends to bridge the gap and contribute to a vibrant private equity ecosystem.
The fund shall focus on minority investments with an investment size of Rs 25-70 crore.
Incofin IM benefits from an Indian footprint of over a decade with successful growth capital investments through local teams in Chennai and New Delhi. Some of the prior equity investments of Incofin in India are Fusion Microfinance, SAVE Solutions, Sohan Lal Commodity Management, Annapurna Finance, and Light Microfinance.
Korys, a key investor in the fund, is a leading food retailer in Europe and is an expert in the operational food value chain with over 50 years of retail industry experience. Korys has significant downstream experience in the agri-food sector and will provide additional support for networking with European retailers and consumer markets.
“Over the last 13 years of being present in India, Incofin has first-hand practical rural market experience. Success from microfinance shall be carried forward to the large unmet missing middle. IPF shall back entrepreneurs aiming to challenge the status quo, in the process to transform from informal to formal market setup,” said Aditya Bhandari, partner, Incofin IM.
IPF is Incofin IM’s first country focused fund and will target financial inclusion of the underserved/underserviced end customer and sustainable development of the food and agricultural value chain in India. The fund invests through private equity in companies with high social performance management practices that also generate a positive and measurable impact for their end clients.