ChrysCapital, India’s largest domestic private-equity firm, has led a Rs 220-crore investment round in energy solutions company
Energy Technolgies that makes, besides traditional automotive products, batteries that drive cars and bikes using the electric power train.
The five-year-old LivGuard was founded by Rakesh Malhotra and Navneet Kapoor, the former founder promoters of Luminous Power, the home-grown power and home electricals major, and was formed three years after the duo sold the business to French engineering giant Schneider Electric for Rs 1,400 crore in 2011.
The transaction has also seen participation from Ncubate Capital, the private investment arm of the SAR Group, which has put in Rs 50 crore into the company. The investment by ChrysCapital comes less than four months after the PE major raised its latest fund — $850-million ChrysCap VIII — in record time.
“ChrysCapital is excited to partner with LivGuard in its journey to become a leading battery manufacturer. LivGuard has scaled well over the past few years and built a strong pan-India distribution network along with an excellent manufacturing footprint,” Raghav Ramdev, director at ChrysCapital, said in a written statement. This is the first external round of institutional funding raised by LivGuard.
Grant Thornton acted as the advisor to the transaction, the process for which kicked off mid last year. Malhotra and Kapoor ran Luminous Power, which was formed in 1988, for over two decades, before selling a 74% stake in the company to Schneider Electric. They later sold the balance 26% in 2017.
With three manufacturing facilities in Himachal Pradesh, the company initially focused on traditional automotive batteries. On completion of the non-compete agreement, which expired in October last year, LivGuard has now entered the inverter, solar and EV battery segments.
According to Malhotra, the company is expected to close FY19 with revenue of Rs 1,400 crore. Its top line in FY18 was Rs 940 crore. “It has begun scaling up very rapidly… It took 23 years for our previous company to get to the Rs 1,000-crore mark. This time, it has taken us barely three years,” Malhotra told ET.
According to him, the company’s manufacturing facilities currently have a total capacity of about two million traditional automotive batteries a year, one million electric vehicle batteries, two million motorcycle batteries and an estimated 1.5 million inverter batteries, among others. “With this, we can get to a revenue of Rs 2,500 crore, without adding much further capex,” Malhotra said.
According to him, the company will use the proceeds from the equity financing round toward product expansion, capacity enhancement, brand and distribution.