Indian food processing and agriculture based companies have caught the attention of global private equity investors as the figures released by accounting and consulting firm Grant Thorton reveal.
Private equity investors have so far invested about US$300 million(Rs 1400 Crore approximately) in these companies during the first half of this year, as per figures released by Grant Thorton. In 2009, investments in these sectors were about $398 million. The investments in food processing and agribusiness in 2008 and 2007 were $187 million and $4.3 million, respectively.
The private equity deal sizes however were not large in this space, but the money was sufficient to give promoters the push they were seeking for. Take for instance, Bakers Circle a New Delhi based Rs 12 crore company, which supplies premium dough and desserts to restaurants and food manufacturers. Bakers dough was able to set up a new facility in Uttarakhand a few years ago, with the help of private equity investor Global Emerging Markets, New York. The fund has so far provided Rs 8 crore,but the company initially accepted an investment of just Rs 4 crore.
In June 2010, the Carlyle Group a global private equity investment firm, based in Washington, D.C., with more than US$ 85 billion of equity capital under management invested Rs 110 Crore in Tirumala Milk Products through the Carlyle Asia Growth Partners IV (CAGP IV).
According to Grant Thorton , private equity players are attracted by greater professionalism and accountability,fairly attractive valuations and the enormous potential of the Indian markets.