Paris-based private equity firm IndEU Capital is raising a $70 million fund to invest in Indian lifestyle and luxury companies. The fund will be based out of Singapore and is in the final stages of closing.
Francois Arpels, managing partner, IndEU Capital, said that the fund will close this year and the first investment will be made in the first quarter of 2016, according to this report. Family offices and private investors from Europe, southeast Asia and the middle east have contributed to the fund.
This will be the second fund for the Indian luxury market, which grew 25 per cent in 2014, compared with 7 per cent in China, according to research firm Euromonitor. Over the next five years, spending in the Indian luxury market is expected to more than double to $3.6 billion.
IndEU will invest over seven years, and the time period of each investment will be around four years. The fund will invest between $1 million and $8 million for minority stakes, spread over 12-14 mid-to-luxury segment companies with an enterprise value of up to $20 million.
“Our focus is to invest in made-in-India lifestyle to luxury companies that target the mid-to-luxury segment with an enterprise value of not more than $20 million. While our focus is to invest in companies that have Indian roots, we would not be looking at ethnic brands that do not fit our international rollout strategy.
Singapore-based L Capital Asia — the private equity business backed by LVMH Moët Hennessy Louis Vuitton SA — is the other, much bigger fund for India’s luxury market. It had closed a $950-million fund in 2013. One of its investments was in Fabindia, the Delhi-based ethnic clothing retail firm.