Government's SRI Fund commits ₹5,000 crore
Premium- 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
MUMBAI: Self Reliant India (SRI) Fund, a ₹10,000 crore fund launched by the Indian government, on Friday said that it has committed over 50% of its corpus in a year since its launch. Having begun operations in October last year, the Fund has so far committed more than ₹5,000 crore to 38 daughter funds for investment in MSMEs, it said in a statement.
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 daughter funds 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 or 20% of the corpus of the daughter fund or ₹10,000 crore. The daughter funds raise the remaining 80% of the capital from outside sources. SRI Fund’s investment will get leveraged fivefold, taking the total value of investible capital into MSMEs to ₹50,000 crore.
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.
In its first year, SRI fund has invested more than ₹2,300 crore in more than 125 MSMEs across 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.
