Private equity is a source of investment capital for the purpose of investing and acquiring equity ownership in companies. Private equity funding is very typical investment transaction; their principle investment fundamental is high risk (secured) with high return; they have clear exit strategy and have prefer capital market route almost. PE fund is invested in startup, growth & established companies. Private equity fund is generally invested by high net worth individuals, financial institutions, banks, mutual fund, NBFCs, Insurance, pension fund, blue chip companies & investment firms. They invest fund as per investment philosophy, size and principles; the investment horizon is between 2 to 7 years.
The Company eligibility for Private Equity Fund
- Company promoter having deep industry knowledge
- Value addition potential at stage of investment
- Unique concept / idea having substantial market potential
- Opportunity in inefficient market
- Companies that have resisted down cycles, & demonstrate a compelling potential to improve margins
- Companies that are market leaders and having highly motivated management teams
- Business to grow to the next level or to multiple levels beyond
- Value addition potential at stage of investment
- Strong & consistent performance since inception
- Companies operating in industries having favorable dynamics for sustainable earnings growth
- Well-diversified business revenue stream
- Time to time upgrade with technology, system and market trend
- Business risks being manageable
Want to be Future Leaders for Equity Fund
In private equity industry, always investor identifying the entrepreneur business with their predefined strategy; generally the investor look for the company that have a clear business strategy, have significant business growth opportunity to scale up with good market positioning.
In private equity the investor are more comfortable in those sector, where the growth are always there, their selected sectors such as Aerospace and defense, Commercial manufacturing, Healthcare services and medical devices manufacturing, Security infrastructure manufacturing and services, Retail branded & private labels business, engineering, Chemical manufacturing, automobile, IT, Pharmaceuticals, Life Sciences, Energy services, Logistics, B2B Services, finance and research company. They invest or take interest if country growth story are there.
In private equity industry the investor start the investment with minority stakes preferably, for majority stake or sizable amount of investment, the growth performance strongly demanded by investor company; also the debt fund in the company are compulsory or mandatory while investor fund invite in the company.
Businesses should ideally have a strong competitive edge and long-term growth potential like
- An Innovative business model
- Growth opportunities to gain regional or national market leadership
- Opportunity for consolidation if from a fragmented industry
Along with the above, they look for outstanding management teams:
- Experienced and passionate people with a disciplined and execution-led approach
- Hunger for growth and a collaborative mind-set with due respect to partnerships
- High level of integrity
Investor’s follow a stringent evaluation process; having a credible business plan that supports the need for growth capital and a clear exit strategy for investors is an important criteria.
Partnering Businesses that Mirror India's Growth Story
Global investors are betting big on India’s long-term growth story. India is today one of the most attractive emerging markets across Asia with a billion plus captive consumers. Mistry and Mehta is well positioned to develop compelling local investing positive presentation.
Investor company focus on macro research, deep analytics and frequent industry interactions, identify industry and socio-economic trends, local consumption patterns and need-gap opportunities on an ongoing basis.
Mistry And Mehta work as strategic advisor with companies that demonstrate one or all of the following value-oriented qualities:
- Sustainable competitive advantage that can be leveraged internationally
- Deep, untapped and fast growth-led domestic market opportunity
- Acquiring scale and sector dominance
The borrowing company has followed an investment process as per investor guideline. The investment process captures the sensitivities and challenges of growing businesses in an Indian business environment.
Generally typically follow a four step proposal process
- Deal Identified and preliminary Evaluation
The deal identification is an important task for the equity proposal, the company proposal will have to match with equity Investor Company investing principal terms that are sector, investment size, area of investment and exit route. The preliminary evaluation like promoter & management, company growth story, Key financial, product and market to be evaluate for eligibility of equity finance.
- Due Diligence and Investment Commitment
With and preliminary evaluation the proposal is identify the equity finance fund, the equity company start the disciplined and rigorous due diligence process with investment criteria. This is critical process in equity finance proposal, some cost are involved in due diligence of proposal which are mandatory. The time frame is in the range of 2 to 4 month base on company and investment size. On the basis of due diligence the investment commitment will be provided by equity investment company.
- Investment Structure and Co-investing Opportunities
Once the investment selection is complete, the investor company team prepares the investment structure and identifies co-investment opportunities, if any, This exercise is done in close collaboration with the company’s management team to align interests.
- Monitoring and Value Addition
Post transaction, designated members investor company team work closely with the company’s management to create shareholder value. As per agreed timelines and performance goalposts, both company work towards a timely and profitable exit.
Crafted Solutions for Growth
Mistry And design bespoke investment structures for each of our portfolio companies based on their individual growth requirements. Mistry And Mehta believe in patient investing through structured instruments that help build partnerships with management teams and deliver on mutually aligned goals and incentives.
Investment Size and Structure
- Investment size differed with investment company its start with USD 5 Million
- Opportunistically larger transactions with co-investment from LPs
- Significant minority ownership with active board-level participation
Accelerating Growth through Value Addition
Mistry And Mehta Capital Advisory believe in long term relation with companies, for growth of company. We accelerate growth through need based strategic value-addition in a variety of ways. In addition to capital, we bring our expertise, experience and commitment to create a shared vision and value.
We follow a four point Value Creation Metric:
- Business Strategy Enhancement
Mistry and Mehta working with the company board and management team, we debate and discuss to arrive at a long-term strategy that captures the competitive advantage of the firm. A sound business strategy is the first step in creating sustainable market domination and long-term leadership for the company.
- Operational and Structural Improvements
Operational efficiency is one of the key areas where we advice the company. We advise the management teams to identify bottlenecks to generate higher returns by restructuring capital, optimizing costs, streamlining manpower and revenue streams. We enable this through a multidisciplinary team of professionals comprising of business strategy experts.
- Catalyzing Talent Acquisition
We advise significant brand power, recognition and network strength; which in turn helps them attract the best talent in the industry. We also inculcating the right talent and developing robust systems and processes is the key to achieving the next level of growth for most emerging businesses.
Private Debt Equity
Mistry and Mehta offer Joint Venture Consultancy services to the Indian and foreign companies who wish to penetrate global markets. We assist our clients in joint venture partner search by effectively evaluating their strengths and weaknesses. We carry out the business valuation of the company to understand and establish synergy between the JV Company.
Venture capital is a type of private equity provided to fund that new enterprises or startup firms. The principal terms are projects having high growth potential. The investor seeks at generating high returns through the realization, they prefer exist through an IPO or a trade sale of the company. The investors are made in exchange for share in the new budding enterprises. Venture capital is now mainly targeted towards high technology industries in any sectors.
New firms with no access to the markets and a desire to make big in this competitive environment are valued for venture capital. We share the zeal of the enthusiastic entrepreneurs and use all our expertise to advice and arrange for the funds to boost the momentum of their growth.
- Detailed discussion with company management for their future plans, growth strategies and investment terms
- Detailed analysis of company financials monthly / quarterly / half yearly / yearly of last three to five years
- Thoroughly understand the business operating cycles, production capacity and market scenario
- If opportunity, carrying out comprehensive risk assessment and preparing the company customized PE investor acceptable document for raising the fund
- Identified specific list of lenders, approach, discussion and obtained preliminary term sheet
- In-depth study of project, if opportunity we signing the contract of assignment
- Suggest such equity investor having similar industries investment exposure in the project.
- Developing the highly customize acceptable investment acceptable document
- 100% success of assignment
- 100% In house all process till obtaining term sheet
- Obtaining Industries acceptable reasonable terms sheet