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IndiaNivesh begins investing in SMEs

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09th January, 2019 15:03 IST
INRF will own significant minority stakes in SMEs by infusing capital. MUMBAI: Mumbai-based IndiaNivesh Renaissance Fund (INRF), India’s first turnaround situations fund, has begun to deploy its capital into small companies amid the initial signs of a revival in private investments this year.

The fund, managed by IndiaNivesh First Bridge Fund Managers, has invested Rs 68 crore in two small companies, including in Vadodara-based Sebacic India and Pune-based Autoline Industries.

The investment will be used mainly to finance working capital needs, such as procurement of raw material, payment of wage bills, and costs related to routine operations.

“Our investment theme is to invest into small and medium companies that are in the turnaround situations,” said K.K.Rathi, Managing Director, Indianivesh First Bridge Fund Managers. Both the companies fit the bill, he said.

Autoline is a listed auto-ancillary company manufacturing sheet metal components, sub-assemblies and assemblies, foot control modules, parking brakes, hinges, cab stay and cab tilt, exhaust systems, tubular structures, and fabrications, for large OEMs in the automobile sector.

Sebacic India is a manufacturer and exporter of sebacic acid. The company is fully compliant with Indian EPA laws and REACH (Registration, Evaluation, and Authorization of Chemicals), the EU regulatory system.

Small and medium companies have been struggling to raise funds after a spate of defaults late August by IL&FS triggered a liquidity squeeze, raising the cost of funds in the broader economy. Cash-starved SMEs seeking a turnaround now have a lifeline in IndiaNivesh-First Bridge Capital Manager. The fund, introduced a few months ago, is a capital support for firms that critically need working capital for survival.

In November, IndiaNivesh-First Bridge Capital closed its first tranche of the Rs 900-crore fund, called the IndiaNivesh Renaissance Fund (INRF). It will own significant minority stakes in SMEs by infusing capital.

“We are looking to deploy the money in SMEs that are struggling due to business underperformance or financial stress," saidSridhar Ramachandran, CIO, IndiaNivesh First Bridge Fund Managers.

IndiaNivesh Renaissance Fund is chaired by former Securities & Exchange Board of India chairman GN Bajpai.
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