HSBC pvt equity to raise over 100 million fund for S.Asia

At present, HSBC Private Equity operates a 60 million fund, which is the fund’s first private equity fund for investment in unlisted companies in India and South Asia.

He said that the next fund will be raised only after its current fund is exhausted, expected in about 8-12 months time. The current fund has invested about 40 million in as many as eight companies of which only one company is outside India.

"Apart from the $ 3.5 million investment in Sri Lanka’s Millennium Information Technologies Ltd all other investments are in Indian companies," Marwaha said. India has lot of potential for private equity investments especially in sectors such as infotech, biotech, retailing, entertainment among others, he said.

Marwaha said HSBC Private Equity’s policy is to take equity investments only in the second stage. "We do not invests in companies as initial seed capital," he said.

Marwaha said that in two companies that the existing funds invested in India, it has made its exit from one company fully and in another partly.

HSBC Private Equity, which put in about $ nine million in Ahmedabad-based Shree Rama Multi Tech Ltd, partly made its exit during the company’s initial public offerings.

He said in Kurlon Ltd, the fund made a full exit from the venture. The fund, which held 27 per cent stake for $3.8 million in the Bangalore-based mattresses company, sold its stake for $4.6 million.

Marwaha said the fund as a policy never redeploys the money after exiting from ventures but returns it back to investors. The remaining 20-odd million dollar in the current fund will be exhausted after investments in six to seven companies, mainly in India itself, he said.

"We will soon close a deal on a E-commerce portal, which is a business to consumer (B2C) kind of portal," Marwaha said without giving further details.