Hyderabad-based Caspian Equity to roll out sector-focused funds
Hyderabad: Hyderabad-based Caspian Equity, an impact investment company over the last 17 years has attracted funding from development finance institutions, family offices and HNIs and has invested in food & agriculture, SMEs, and financial inclusion sectors, and returned over $180 million to investors. Saurabh Johri, ED and CEO, Caspian Equity shares with Telangana Today how the company aims to build on the traditional strengths by leveraging grassroot connects with entrepreneurs and delivering on both impact and financial metrices to the investors.
Multiple sectors
Caspian Equity invests in socially responsible, multiple bottom-line businesses delivering financial and social value. The company deploys private capital into sectors including financial inclusion (microfinance, small business financing, housing finance companies and affordable school financing), food & agribusiness, education, healthcare, last-mile banking, and renewable energy.
Impact funds
We have set up four impact funds– Bellwether Microfinance Fund for microfinance sector, India Financial Inclusion Fund for microfinance and affordable housing finance, Caspian Impact Investments (Caspian Debt), and Caspian SME Impact Fund IV. We have over $190 million assets under management. We are looking at extending additional support for social impact enterprises beyond providing capital. Our time horizon is long-term (about eight years) and typically make investments in the range of Rs 1 crore to Rs 25 crore per venture.
Agritech fund
We are actively working on launching a fund for agribusiness in the first half of 2022, which will look at technology interventions on the farmers’ side in the areas of improving yield, price realisation and intervening with new technologies. Food and agriculture sector has been one of the major beneficiaries in the last 18-24 months, and several innovations are happening in this space. We may support 12-15 startups through this fund.
Investment flows
While predominant flows are happening in India in the services sector, there is some movement in the product and intellectual property (IP) creation as well. Caspian SME Impact Fund IV has been helping both services and product startups. We have helped a solar startup create strong IP and another company that converts waste into cooking gas. We believe IP-based companies have scope to scale up faster. Last year, we made four investments in total (across sectors) and we will be making about 4-5 investments in 2022. We have also made investments into companies operating from Africa and Bangladesh.
Emerging technologies
Caspian is keen to support technologies such as drones that may help agriculture sector or those companies that are working on weather data that can provide actionable insights to farmers or those that provide data tools for better soil analysis. We are primarily looking at investing in companies where application of technologies is possible rather than purely research-based ideas.
Renewable focus
Commitments to renewable sector is set to grow in India. We will focus on solar technologies that are suitable for large scale implementation. We will look at innovative ideas that are low-to-medium on capex, which are able to scale up quickly.
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