ChrysCapital closes record $2.2 bn fund; largest PE fund ever raised by an India-focused firm

Kunal Shroff

Leading homegrown private equity firm ChrysCapital, which backs firms ranging from NSE and Hero FinCorp to Theobroma and Intas Pharma announced the successful closure of its latest fund, ChrysCapital X, at $2.2 bn on November 5.

The development has set a new record for the largest private equity fund ever raised by an India focused firm. Last year domestic peer Kedaara Capital closed its $1.73 bn fund, Kedaara IV.

"The fund will build on the firm's commitment to partnering with established companies to drive sustainable growth, operational excellence, and value creation that delivers meaningful impact for investors," ChrysCapital said in an official statement.

It added, "The final close of the fund was within 6 months of the first close, which is a testament to the trust placed in ChrysCapital by investors, especially during a challenging global macro and fundraising environment. The fund marks a more than 60% jump from its $1.35 billion Fund IX in 2022."

Speaking to Moneycontrol post the announcement, Kunal Shroff, Managing Partner at ChrysCapital said, "I think we are proud to have raised fund X which closed at $2.2 billion. I think we are more proud that it's fund X frankly than just the number. Very few firms in private equity in Asia have reached this milestone with their own fund time. It signifies consistence, returns, giving capital back to LP's, building their trust and hopefully building some brand, some reputation for yourself."

Shroff added that the private equity landscape is growing much faster than the overall GDP growth in the country and ChrysCapital is "nowhere close" to arrive in terms of the opportunity set in India.

"The key question to ask is - what is the size of the opportunity? how big is this market and what share do you have of that market? And I think our share is in single digits. So in a way it's a good milestone to have, but we are nowhere close to arrive in terms of what the opportunity set is right? Indian private equity has been growing at a fast pace because companies have been moving from minority to control or small minority to significant minority," Shroff told Moneycontrol.

"So the same size company becomes a 3X size deal because the entrepreneur instead of selling 5% or 10% is selling 25-30% or giving control which is even larger. So the private equity landscape is growing much faster than overall GDP growth in India. In that context, when we think about our fund, yes, it's good to have a $2.2 billion fund, but the opportunity to deploy it is massive in terms of the types of deals that are available," he elaborated.

So does ChrysCapital X mean the firm will cut bigger cheques going ahead?

"On deal size, I don't think we want to stray too much from what we are doing. And in fund IX, our typical sweet spot has been $75 mn to $200 mn per deal from the fund. Occasionally we've looked at a larger deal, but then then we curtailed ourselves down and brought in LPs to do the larger deal. In fund X, we will stick to $75 mn to $200 mn," Shroff responded adding that the range is less competitive than the $500 mn plus spot and is seen as "too small for the globals and too large for the locals which haven't scaled up that much."

ChrysCapital X has added more than 30 new global investors, comprising public pension funds, insurance companies, asset management firms, family offices and other institutional investors from Japan, the Middle East, South-East Asia, Europe, and the US. In addition, for the first time, the firm has raised capital from Indian investors, with strong participation from institutional investors as well as large family offices, as per the announcement.

Since its inception in 1999, the India-focused investor has raised close to $8.5 billion across ten private equity funds, a continuation vehicle, and its public markets fund. Through its private equity funds, the firm has deployed over $5.5 billion in more than 110 portfolio companies. It's portfolio also includes the likes of Mankind Pharma, GeBBS Healthcare, Infogain and Awfis and it has returned almost $7.8 billion at a 3.0x ROI from 80+ exits to its investors.