Axis invests INR540m in Indian green energy(5)

In its first cleantech deal, the Mumbai private equity firm has backed a company focused on the operation of biomass and small hydropower projects.

India-focused Axis Private Equity has invested INR540 million ($11 million; €8 million) as part of a INR900 million funding round for Shalivahana Green Energy, a renewable energy company focused on the operation of biomass and small hydropower projects.

The round's other investor is IL&FS Financial Services, the financial services arm of the IL&FS Group, which invested INR360 million.

PEO had reported in February that Axis was close to finalising this investment.

Shalivahana currently has four operational projects with an aggregate capacity of 35-megawatts. The company is looking to develop a number of biomass and small hydro power projects across India and expects its capacity to exceed 250-megawatts following the investment.

More than 60 percent of India’s power generation capacity is from thermal sources and renewable energy sources (excluding hydro projects above 25-megawatts) account for no more than 9 percent, Alok Gupta, managing director and chief executive officer of Axis Private Equity, said in a statement.

The investment in Shalivahana is Axis’ fifth from the Axis India Fund, its maiden investment vehicle. The fund is targeting commitments of $400 million. It makes equity investments in rapidly growing infrastructure-related companies.

Thus far, Axis Private Equity, which is the private equity arm of Axis Bank, has invested about INR3.2 billion in four companies: a water treatment and sewage company, a hotel group, a oil and gas sector service provider and a rail track maker.