Chennai-based Anicut Capital is expected to mark the first close of its Rs 1,500 crore (around $184 million) debt fund by April 2023, a top executive told VCCircle. The fund has received Sebi approval and expects to launch in January.
The company’s third debt fund – Grand Anicut Fund 4 – is expected to see its first close at Rs 400 crore ($49.1 million), the venture capital firm’s founding partner Ashvin Chadha told VCCircle in an interaction.
Grand Anicut Fund 4, a category-II fund will also have a greenshoe option of Rs 500 crore (around $61 million), apart from the targeted corpus of Rs 1,500 crore.
Through this fund, Anicut will make concentrated bets in mature companies with turnover of Rs 100-500 crore across sectors, except real estate, Chadha said. The fund’s average ticket sizes may lie in the Rs 30-40 crore range, which may go up to Rs 100-120 crore according to its debt investment strategy.
In a bid to strengthen and diversify its debt operations, Anicut Capital has also onboarded Chetan Prakash Sancheti as a partner in the firm. Sancheti has earlier held key positions at CredAvenue, and Spark Capital.
Earlier this year, Anicut closed its second debt fund with a Rs 875 crore corpus, of which, it invested about Rs 550 crore in 15 startups in CY22. The second debt fund’s average ticket size lies in the Rs 15-100 crore range, Chadha said. Its first fund was launched in 2016, raising about Rs 400 crore from its limited partners (LPs).
Founded in 2015 Chadha and IAS Balamurugan, Anicut Capital is a venture capital firm that manages alternative assets. Under its Grand Anicut Fund, the firm operates debt and equity schemes with about Rs 1,600 crore of assets under management. So far, it has made 39 debt investments and picked equity stakes in about 50 startups, as per its website.
Its equity portfolio, relatively new to its credit vertical, includes the Anicut Angel Fund and Rs 500-crore Anicut Opportunities Fund I, which hit its first close in June this year at about Rs 170 crore.
Chadha also expects the Rs 500-crore Anicut Opportunities Fund I to mark its final close by April 2023, even though it has made commitments worth Rs 40 crore in 5 startups, and is likely to end the year with 7 investments from the corpus.
In total, Anicut Capital plans to fund about 12-14 companies, and is looking to fully-deploy the fund’s corpus by the end of 2023, the founding partner said. He added that about 30-40% of its corpus would be reserved for follow-on investments.
Some of its portfolio firms include Wow Momo!, Giva, Akna Medical, Lendingkart, Bira, Sugar Cosmetics, Blue Tokai, Neemans, Earth Rhythm, Wingreens, MilkyMist, and Social, among others.
Anicut Capital raises domestic capital directly from LPs, and in line with the earlier funds, it did not use any intermediary such as distributors and wealth managers, Chadha said. One of its key investors includes Small Industries Development Bank of India (SIDBI), which acted as the anchor investor for its second debt fund with a commitment of Rs 140 crore.
In 2020, the firm had also launched Anicut Angel Fund, through which it has deployed over Rs 200 crore in about 50 startups.