Self Reliant India (SRI) Fund, a Rs 10,000 crore Fund of funds (FoF) launched by Government of India, said on Friday it has committed over 50% of its Rs 10,000 crore corpus in a year since its launch.
The SRI Fund, which began operations in October 2021, so far committed more than Rs 5,000 crore to 38 daughter funds, it said in a statement.
A Fund of funds is a pooled investment fund (in this case, called the mother fund) that collects money from investors and deploys it into other types of funds (daughter fund).
These include Tata Capital Healthcare Fund, Aavishkaar India Fund, SVL-SME Fund, Gaja Capital India Fund, Avaana Sustainability Fund, ICICI Ventures’s India Advantage Fund S5 I, Omnivore Agritech & Climate Sustainability Fund 3, Fireside Ventures Investment Fund III.
With an investment structure of a mother-daughter fund or Fund of Funds, the SRI Fund– as mother fund–will invest up to 20% of the corpus of the daughter fund or Rs 10,000 crore.
The SRI fund is a Category II Alternative Investment Fund that the Indian government set up to make equity investments in Micro, Small and Medium Enterprises (MSMEs) with an aim to address the current capital gap and catalyse the flow of capital in the sector.
It is anchored by NSIC Venture Capital Fund Limited, a wholly-owned subsidiary of The National Small Industries Corporation Limited (NSIC).
The fund “augments Government of India’s efforts in expanding and diversifying mobilization of capital for MSME businesses. An increased capital pool will help enterprises reach their full potential and graduate beyond the MSME bracket and become National / International Champions,” said Gaurang Dixit, CMD, NSIC and Chairman NSIC Venture Capital Fund.
Amitava Chatterjee, MD & CEO, SBI Capital Markets, said that “In its first year of operations, SRI Fund through its empanelled daughter funds has already helped provide equity funding of more than Rs 2,300 crore to more than 125 MSMEs across diverse sectors such as climate, agriculture, defence, education, pharma and industrials.
The fund is also launching an online technology platform to standardise procedures for daughter funds to efficiently seek investment from SRI Fund. It will also facilitate interactions between the mother-daughter fund, and help in compliances and reporting.