Kedaara Capital Targets Record-Breaking $1.7 Bn for India’s Largest PE Fund

In a significant development for India’s private equity landscape, Kedaara Capital is gearing up to raise a staggering $1.7 billion, making it the country’s largest PE fund to date. Sources close to the matter have revealed that approximately 80% of this fresh capital will be secured from existing investors, with the remaining 20% sourced from new backers.

The upcoming fund is expected to witness participation from prestigious institutions such as the US-based Cleveland Clinic and the University of Minnesota. Notably, Kedaara Capital has previously attracted investments from prominent entities like Ontario Teachers Pension Plan and German insurer Allianz.

This massive fund is earmarked for investments in diverse sectors, including banking, healthcare, consumer services, and Software as a Service (SaaS). Kedaara Capital is poised to explore opportunities ranging from minority stakes to complete acquisition deals, reflecting the fund’s strategic and diversified investment approach.

The official announcement of the fund is anticipated by the end of March, with ongoing finalization of documentation with investors. Despite investor willingness to commit capital exceeding $2 billion, Kedaara Capital has opted to cap the fund at $1.7 billion to ensure optimal deployment without straining their operational capacity.

Established in 2012 by former Temasek and General Atlantic executives Manish Kejriwal, Sunish Sharma, and Nishant Sharma, Kedaara Capital has been a stalwart in India’s private equity sector. The firm boasts an impressive track record of backing successful startups, including Lenskart, Perfios, and Purplle.

This forthcoming fund will mark Kedaara’s fourth, surpassing its third fund by 54%, which reached a final close at $1.1 billion in 2021. Typically investing between $25-75 million per venture, Kedaara Capital has occasionally committed up to $200 million in select situations.

The strong response to Kedaara Capital’s fourth fund is noteworthy, particularly amidst the prevailing funding challenges. Foreign investors and limited partners continue to express interest in India’s rapidly expanding economy, drawn by the potential for lucrative returns.

India’s thriving startup ecosystem further adds allure, with founders crafting innovative solutions for both domestic and global markets. Despite global economic uncertainties, the nation remains a hotspot for fundraising activities, as evidenced by the launch of 64 new funds in the previous year, amounting to $5.6 billion, and the introduction of 126 funds in 2022, raising over $18 billion for startup investments.

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