Private Equity Firms in India

Private Equity Firms In India

Top Private Equity Firms in India

Fund Source is a Top Private Equity Firm in India that offers customized private equity & debt investment solutions for fast-growing companies looking for good investment solutions to multi-fold their sales figures & take their business to the next level of growth. We provide customized investment solutions that support a company’s current business requirements and help in maintaining positive cash flows. 

Our experienced team does the assessment of client business & underlines securities and explores the best possibilities on the proposal. We are a company which works on the modern day solutions of the financial market. We work symmetrically with the client to arrange & manage the documentation required in PE transactions to deliver or service the commitment.

We provide Private Equity facilities across all major cities of India so if you looking to raise funds through private equity then contact us for a professional experience.

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What is Private Equity?

Private Equity is partial ownership in an entity through buying the shares of that entity which are not listed on a public exchange and the private equity investor holds the shares as per agreement for getting profits for their investments.

Private Equity is generally raised by companies who are looking to increase their business sales by expanding their network or to infuse money into different verticals of their business like purchasing raw materials, increasing unit capacity, or expanding their network in multiple cities or countries. The primary source of private equity can be HNI or institutional investors or pension funds. Private equity investor infuses money as working capital for the expansion of the company. The private equity investor holds ownership of that company by taking stakes in the company & he acts as an investor that not only provides funds but also holds the management rights to work with the company to enhance company value through changes in operational activities or restructuring.

Key Features of Private Equity

  1. Collateral-Free Investment: This could be the best capital-raising tool for fast-growing companies which does not have solid collateral securities to offer as private equity partner does not require any collateral security for their investment in the company.
  2. Tenor: Private equity investor stays for a minimum of 3 years to 7 years. This gives ample time for the growth of the company which ensures a timely exit for investors with good profits.
  3. Value Creation: Private equity partners work closely with company management to implement operational improvement, growth strategies & cost-saving measurements, and all these improve company value.
  4. Improves Cashflow: Unlike traditional debt loans, private equity does not require repayment on a monthly EMI basis which enhances cash flow that can be ultimately re-infused in the company to give additional boost for growth.

 

Through private equity, a company can be able to raise funds for its business expansion by selling its stakes for a temporary period which ensures good returns for investors & amicable growth for the company through the infusion of private equity funds. 

Requirements to Avail of Private Equity

  • Entity must be private Ltd or Ltd company
  • Must be having good credit rating through a verified credit rating company
  • Strong business model that shows high growth potential & scalability
  • Must be having a history of strong financial performance & revenue generation
  • Must be having a strong management team 
  • Company must be having high demanding products & services 
  • Company must propose a clear path for the exit of the private equity partner
  • Company must be having well organized financial statement to conduct due diligence

 

Difference between Private Equity & Venture Capital: People often confuse between private equity & venture capital as both include investment in companies to earn high returns in the future. But there are marginal differences between them.

                                               Venture Capital                                                          Private Equity
  • Venture capitalists only invest in startups that have a high growth potential.
  • Venture capitalists help the company via financial funding as well as knowledge transfer, technology transfer, etc.
  • Private Equity investors prefer both startups as well as mature companies that seek funds to improve their performance.
  • Private equity includes financial funding & also holds the rights for management modifications.

What is Private Equity Firm?

A Private Equity firm is a fund management company that raises funds through various sources & investors and infuses that investment into privately held companies & assets to ensure good returns to its investors.

Private equity firms raise money through ultra-high-net-worth individuals, institutional investors & pension funds and invest that capital into privately held companies that show remarkable signs of growth in the future. By investing capital into these companies the private equity company assures a high return to its investors & this is the main objective firm to only invest in companies that can yield high returns to investment so the investors can earn handsomely on their investment.

Phases of Private Equity Investment

  1. Sourcing: First private equity firm identifies a suitable investment opportunity through their network & connections.
  2. Due Diligence: Then they conduct the financial & legal due diligence to reach out company’s potential for growth & market position.
  3. Deal Structuring: Once the due diligence ends with positive reports then the deal is structured for the amount to be invested, ownership stake & governance rights.
  4. Value Addition: After the investment, private equity investors actively work with the company’s management to implement strategies that can enhance the company’s value, such as operational improvements, expansion, or restructuring.
  5. Exit: The ultimate goal of private equity investment is to exit the investment with significant returns. Exits can occur through various means, such as initial public offerings (IPOs), mergers and acquisitions (M&A), or secondary market sales.
Top Private Equity Firms in India
 

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