TARA IV Fund: Realizing value in India by investing in small and mid-cap companies with high societal impact

January 5, 2015

Fund summary

In 2015, KOIS assisted IIML in the creation of TARA IV fund. The aim was to pursue profitable and socially relevant investments in India. TARA IV primarily targets small to middle-sized technology enabled Indian companies with a focus on innovation. The fund focuses its investments on sectors creating a positive social footprint.

Investing in fast-growing impact sectors

Over the past decade, SMEs have emerged as highly vibrant and dynamic engines of the Indian economy. They play a crucial role in providing employment opportunities for Indians at relatively low capital cost and have a great impact potential for the Indian community. They also contribute to industrializing rural areas, ensuring a more balanced and equitable distribution of national income and wealth.

TARA IV is a private equity fund managed by IIML, to whom KOIS is advisor. The fund has raised US$ 50 million and had invested, as of end December 2019, in 8 technology enabled, innovation-oriented SMEs, in fast-growing impact sectors: healthcare, education, energy, ICT and financial inclusion, food and agriculture, and logistics. The activities of these companies contribute to the living standards of low to middle income by:

  • Improving access to affordable basic goods and services of high quality;
  • Producing goods or services that increase the yield of the production and/or distribution processes of such basic goods and services;
  • Enabling transfer of high value knowledge and skills to the local workforce through their operations;

In addition, they also help preserve and/or restore the environment through reduction of emissions, waste materials and other such negative externalities.

Fund characteristics

Launch

2015

Committed capital

$ 50M

Size of investments

$ 1-4M

Target net IRR

20%

Note: Last updated April 2020

Portfolio companies

TARA IV Fund typically invests in early to mid-stage businesses targeting large addressable markets. Tara IV takes minority stakes in its companies with strong control provisions. All of its investees fit a strong impact investment thesis, serving the dual objective of positive societal/environmental impact and attractive financial returns.

OVUM: High-end maternal and child care reducing the mortality and morbidity rate of newborns

Company inception year: 2011

Investment year: 2016

India sees over 1 million neonatal deaths per annum and very high premature delivery rates. This is due to a lack of quality mother and childcare services and non-availability of fully equipped Neonatal Intensive Care Units (NICUs).

OVUM hospital is a maternity and childcare specialty hospital founded by a team of four doctors to cater to the demands of specialized quality care for the growing middle class of India thereby bridging the healthcare gap. At the time of investment, OVUM had two hospitals with 36 beds, 10 NICU beds and one IVF centre in Banaswadi. It also provided NICU coverage to Milann Fertility Centre and Chinmaya Mission Hospital.

OVUM’s impact

  • ~1600 births healthy babies delivered
  • 480+ Neonatal Intensive Care Unit treatments
  • 750+ gynaecology treatments
  • 99.6% neonatal survival rate achieved

Lilac Insights: Providing prenatal screening and genetic services to improve pregnancy outcomes

Company inception year: 2011

Investment year: 2017

Founded by a team of three healthcare professionals and advised by leading gynaecologists who have extensive prenatal expertise, Lilac Insights provides prenatal screening and genetic services to improve the pregnan- cy outcome by offering early insights into the health of babies before their birth.

Lilac Insights presently operates through its main genetic laboratory at Navi Mumbai and satellite laboratories at Ludhiana and Chandigarh and has relationships with more than 700 maternity homes and doctors.

Lilac Insights’ impact

  • 144+ prenatal screenings conducted since investment

LifCare: Full-service subscription pharmacy focused on chronic disease management

Company inception year: 2015

Investment year: 2018

Lifcare is a full-service subscription pharmacy focused on chronic disease management, with a robust offline channel for customer servicing. At the time of investment, the Company was servicing Delhi, Jaipur and Tier-II, III and IV towns in Rajasthan.

Lifcare offers higher availability of medicines, access to genuine drugs, product discounts and helps improve medical adherence.

LifCare’s impact

  • 97% of prescriptions filled, compared to an average fill- rate of prescription of 70% in India
  • Increased adherence to prescription-based medicine

  • Significant reduction of counterfeit drugs in circulation as a result of direct sourcing of drugs by LifCare

Panacea medical technologies: Manufacturing affordable radiotherapy equipment for cancer treatment

Company inception year: 1999

Investment year: 2017

Panacea Medical Technologies is the only Indian company manufacturing radiotherapy equipment, building an affordable linear accelerator that is 50% cheaper than competition.

At its state-of-the-art research facility in Bengaluru, the company builds products with advanced technology at par with major global manufacturers, driven by a lean research and development system.

Apart from its operations in India, the company is present in 25 countries globally through direct employees and channel partners, and has already mapped the market for linear accelerator across India, Africa and SouthEast Asia for the large underserved and unserviced market for cancer treatment in emerging markets.

Panacea’s impact

  • 60+ units sold
  • 800,000+ patients treated

Disprz: Online classroom learning for educational institutions and enterprises

Company inception year: 2016

Investment year: 2018

Disprz provides a platform for the learning industry to deliver high engagement education and training experiences online on all devices in emerging market network conditions.

The company focuses on both classroom learning and online learning for educational institutions (K12 schools, higher education, coaching and online certifications) and enterprises (corporate learning and collaboration).

Disprz’s impact

  • 200,000+ blue-collar workers using the platform
  • 350,000+ hours spent by blue-collar workers on the platform

Transerve Technologies: Developing geospatial solutions for urban planning and development

Company inception year: 2009

Investment year: 2017

Inefficient resource management & tax leakages are some of the key issues in the Indian urban setting. Transerve helps, namely, urban planning bodies plug leakages in tax revenue and be efficient in resource management, which ultimately benefits the local population.

Transerve provides geospatial solutions for urban planning and development, focusing on property tax, water & sanitation. It offers location-based information software to empower decision makers to develop smart cities. It has diverse applications, including property tax, city revenue modules, utilities, air, water and noise pollution.

Transerve’s impact

  • 15,000 properties covered for local governments
  • 1,8M households covered for local governments
  • 80+ sq. km covered for water and sanitation

Caliper business solutions

Company inception year: 2016

Investment year: 2018

Caliper contributes to the economic empowerment of players operating transportation (shippers, transporters, brokers, fleet owners, drivers, etc.) by bridging the digital divide through improved transparency, efficiency and financial inclusion in the ecosystem.

They for instance, helped in elevating of the status of truck drivers. They also greatly improved utilization and income through facilitation of order to idling drivers.

Caliper’s impact

  • 1,400+ truck drivers saw their status elevated, with improvements in job quality and new job opportunities
  • 20+ corporates saw an improvement in the utilization of their income through the facilitation of order for idle drivers and fleet

Infinite Uptime India: IIoT solution provider for engineering and processing industries

Company inception year: 2015

Investment year: 2018

Infinite Uptime is an Industrial Internet of Things (IIoT) solution provider for improved quality, productivity, monitoring and predictive maintenance in the engineering and processing industries.

Their technology allows for less downtime of equipment, leading to higher energy efficiency and enhanced productivity ultimately contributing to reduced emissions for the same level of output.

Besides, the monitoring solutions of the company improve worker safety in all installations with 18 such incidents having already been predicted.

Infinite Uptime’s impact

  • 120+ safety incidents detected using the platform
  • 4,384 hours reduction in downtime
  • 5-10% average efficiency improvements

The fund’s impact

patients served

hours of training provided

people trained

people impacted

Note: Last updated April 2020

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