IFCI Venture was set-up in 1975 by your Company with the objective to broaden entrepreneurship base in India by providing risk capital mainly to first generation entrepreneurs under “Risk Capital Scheme”. In 1988, IFCI Venture launched “Technology Finance & Development Scheme”, to provide financial assistance for setting up projects aimed at commercialization of indigenous technologies.
In 1991, IFCI Venture took up management of a Venture Capital Fund named VECAUS-III, floated by SUUTI and IFCI to promote varied projects across industrial sectors of Indian geography. The VECAUS-III fund was closed in the year 2007 and outstanding portfolio companies were transferred to SUUTI. The Fund was officially closed through sale of portfolio in the year 2011-12.
IFCI Venture is presently managing 5 SEBI-registered private equity (PE) funds/Alternate Investment Funds (AIF) viz. India Automotive Component Manufacturers Private Equity Fund-1-Domestic (IACM-I-D), Green India Venture Fund (GIVF), India Enterprise Development Fund (IEDF) and Venture Capital Fund for Scheduled Castes (VCF-SC) and Venture Capital Fund for Backward Classes (VCF-BC) with an aggregate corpus of Rs. 848 crore. IFCI Venture derives income from the fund management activities by way of management fee on the corpus/ outstanding amount of funds and by way of profit on these investments. Out of the above, three funds namely GIVF, IACM-1-D and IEDF are likely to close soon and all efforts are being made for optimizing recovery from outstanding investments.
The “Venture Capital fund for Scheduled Castes” (VCF-SC), is a Government of India initiative of Ministry of Social Justice and Empowerment (MoSJE) being the implementing agency. VCF-SC is a first of its kind Venture Capital Fund in India dedicated to promote entrepreneurship among the Scheduled Castes by providing concessional finance to them. During the year, Government contributed an amount of Rs.40 crore for VCFSC fund. As a result the corpus of VCFSC fund has increased to Rs 330 crores. Recently Government of India had mandated IFCI Venture to manage the ‘Venture Capital Fund for Backward Classes’ (VCF-BC) and Rs.10 crore initial corpus has been received.
With a view to tapping further opportunities in PE/ VC space, IFCI Venture is in the process of raising the next round of funds viz. Small & Medium Enterprises Advantage Fund (SMEAF) and Green India Venture Fund II (GIVF-II) for which IFCI has consented to act as the “Settlor” and “Sponsor” along with commitment of contribution of Rs 50 crore in each of the Funds. The Funds, having a target corpus of Rs 500 crore each, are floated as Trust Funds, registered under SEBI as Category II Alternative Investment Fund (AIF). The fund raising process for GIVF-II and SMEAF is being undertaken. Another Fund on Affordable Housing is also likely to be launched shortly.
Being an NBFC, IFCI Venture also extends corporate loans to companies in the range of Rs.5 crore to Rs.25 crore, by raising funds through bank loans and bonds, with security of mortgage of property and/or shares of listed companies. The Company has a well-defined credit policy for sanction of loans.
The Company has reported total net profit of Rs. 5.22 crore on total income of Rs. 87.46 crore for the financial year ended March 31, 2018, after net provisioning of Rs.22.42 crore for Loans and investments. The Net Worth of the Company stands at Rs. 222.99 crore. As on March 31, 2018, IFCI Venture had a book-debt position of Rs. 421.22 crore and bonds & bank borrowings stands at Rs.298 crores.