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Sequoia invests Rs50 cr in Stovekraft

Sequoia invests Rs50 cr in Stovekraft
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First Published: Wed, Mar 31 2010. 10 27 PM IST
Updated: Wed, Mar 31 2010. 10 27 PM IST
Bangalore: Continuing the momentum of venture capital (VC) deals in the past two weeks, Sequoia Capital India and Norwest Venture Partners India (NVP) separately invested in two companies on Wednesday.
Sequoia Capital invested Rs50 crore in Bangalore-based Stovekraft Pvt. Ltd, which makes the Pigeon and Gilma brands of kitchen appliances and modular kitchens.
Profit-making Stovekraft, growing at 40-50% the past two-three years and expecting to close the current fiscal with a revenue of Rs300 crore, intends to utilize the corpus for funding its expansion across India.
“Consumer sector is an area of focus for us. Consumer sector companies become profitable soon if their business model and offering is right. Once they grow to a size, they don’t need much cash,” said Sandeep Singhal, managing director, Sequoia Capital. However, striking deals in this space is not easy as the opportunities are limited, he said.
NVP invested about $4 million (around Rs18 crore) in online classifieds platform Quikr India Pvt. Ltd, which has raised $6 million overall in its third round of fund raising. Its existing investors Omidyar Network, Matrix Partners India and eBay Inc. also participated in this round. Quikr has raised at least Rs50 crore since inception in 2000.
Consumer demand has been the key driver for Stovekraft and Quikr.
VC firms are attracted to strong brands that are unlikely to get diluted, said Srikanth Narasimhan, director, Veda Corporate Advisors Pvt. Ltd, an investment bank.
Narasimhan added that with VCs coming out of a hibernation of a year-and-a-half, consumer goods and infrastructure services sectors were emerging as hot spots for investment.
On 25 March, VCs put up a strong deal flow, announcing four deals in a day, three of them by the VC arm of the world’s largest electronic chip maker Intel Corp.
Separately, a consortium of VC firms comprising Kleiner Perkins Caufield and Byers, Sherpalo Ventures and Reliance Venture Asset Management Ltd invested an undisclosed amount in Reverse Logistics Co.
deepti.c@livemint.com
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First Published: Wed, Mar 31 2010. 10 27 PM IST