India’s Yes Bank launches food and agribusiness fund

India’s YES Bank is looking to raise $100 million for a new private equity fund to help scale medium sized business in the food and agribusiness sectors.

YES Bank, a private bank listed on Bombay Stock Exchange, and backed by private equity investors, has launched a $100 million (€74 million) private equity fund that will be invested in food and agribusiness sectors, the first of its kind in India.

The fund will invest in companies engaged in “high-growth areas” spanning grain based products; milk and diary products; spirits and beer; tea and coffee, food retail, logistics and agri-infrastructure, according to a statement.
Sonal Shah, senior director of the bank’s agribusiness funds management, will head the fund management. Based in New Delhi, Shah was appointed in July last year to set up and manage the fund. She will lead a team of five dedicated to the bank’s first private equity fund, she told PEO in an interview.

The team is expected to be in place toward the end of June. YES Bank will be sponsoring the fund but Shah declined to comment on the amount.

Each investment will range between $5 million to $7.5 million, and the new fund manager has identified several companies it can potentially invest in. The bank is confident of building a diversified portfolio of 10-15 investments in the next 1-2 years.

YES Bank was founded in 2003 and its investors include Citigroup Ventures Capital International, India-focused private equity firm ChrysCapital and Hong Kong-based AIF Capital. In twelve months to 31 March 2007, the bank posted a 170 percent jump in operating income to 7.821 billion Indian rupees ($192 million) from the 2006 financial year, while after-tax profits rose 71 percent over the same period.