At a time when foreign institutional investors (FIIs) are pulling out of India, private equity(PE) firms, it appears, are busy bringing in money, specially through private investment in public enterprise (PIPE) or investments in listed companies. Pulak Prasad (ex-Warburg Pincus) led Nalanda Capital, which has the mandate to invest in listed companies, has acquired 7.97% stake in Page Industries for around Rs 35 crore (~$7.4 million).
Page Industries is a licensed manufacturer of the Jockey brand of innerwear in the country. The innerwear market is highly fragmented with a number of regional players in the branded segment, besides a huge unbranded category which is led by small players.
The firm which came up with its public offering in 2007, had net sales of Rs 192 crore with net profit of Rs 23.8 crore during FY08. For the quarter ended June'08 it recorded 39% jump in revenues to Rs 65.9 crore against Rs 47.4 crore during Q1'07. Net profit rose by 31% to Rs 8.7 crore.
Nalanda has got pretty active in acquiring shares from the secondary market. Just one week back it had hiked its stake in engineering firm Kirloskar Oil Engines from 3.16% to 5.72% in a deal estimated to be worth Rs 38 crore ($8 million).
The Singapore-headquartered PE fund with a $400 million corpus had earlier picked 5% stake in Chennai-based Carborundum Universal for Rs 65 crore. Its other investments in India include Jaipur-based jewellery maker Vishal Gems and US-listed BPO firm WNS (Holdings).
While some PE firms like Nalanda have been making fresh investments through PIPE transactions, others like ChrysCap has been bringing down its cost of investments in present portfolio by buying in the secondary market which is falling relentlessly. ChrysCap's arm Warhol has acquired another 2.3% in Ahmednagar Forgings from the open market to take its stake to 9.89%. As per stock prices, it would have invested about Rs 6.5 crore.