India: Impact investor Lok Capital marks first close of third fund at $40.5m

Photo: Mint

India-focussed impact investment firm Lok Capital has marked the first close of Lok Fund III at $40.5 million.

With this close, the total capital under-management with Lok Capital incluging Fund I and Fund II will bring to over $125 million, the company said in a statement.

Existing LPs – CDC Group Plc, the development finance institution of the UK, Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden N.V.’s (FMO) and Société de Promotion et de Participation pour la Coopération Economique  (Proparco) – also participated in this funding round.

TIAA Global Asset Management has come in as a new investor in Fund III which has a total target corpus of around $100 million, which the investment firm expects to close in the next 12-18 months.

The fund will be deployed in the next five years and will focus on growth stage investments in financial services, healthcare, agriculture and livelihood. The average tranche per investment will range from $2-10 million, however, Lok Capital will continue to collaborate with LPs for joint investment in larger deals, as in Fund II.

“Aided with the government initiatives from the last few years along with very progressive regulatory environment, the climate is ripe in India for deepening financial inclusion through both traditional business models as well as through fin-tech models. By committing to the third fund, our investors have placed trust in the founding team, which has stayed together for the last 10 years and on our ability to stay disciplined while investing and managing investments,” said Venky Natarajan, Managing Partner, Lok Capital.

The areas of interest for Lok Capital in the healthcare space include delivery of affordable healthcare, devices and diagnostics in under-served regions. And, in the agriculture sector, the fund will focus on dairy, supply chain management and integrated farm-to-fork models.

Earlier this year, Lok invested in Pune-based Siddhivinayak (SV) Agri Processing, an end-to-end potato supply chain management company, marking its first investment in the agriculture sector. Fund III is expected to back more enterprises in the agri and dairy space.

Lok Capital said it has fully returned the committed capital of $22 million from its first fund with an internal rate of return of 15% in dollar terms. The second fund is currently tracking gross returns of 28% in dollar terms, with portfolio companies Equitas and Ujjivan going public. Some of its good exits include Satin Creditcare, Janalakshmi Microfinance and RuralShores.

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.