Tata Capital Healthcare Fund II Makes Investment Commitments of INR 955 Crores

TCHF II will seek to achieve returns by principally taking equity positions in healthcare and life sciences related companies having significant business exposure to India

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Tata Capital Healthcare Fund II (TCHF II), a Tata Capital Limited initiative, has announced the final close of its fund with investor commitments of INR 955 Crores. The fund announcement meets its target of Assets under management (AUM) of INR 950 crores.

The second round of fund announcement acts as the follow up to CHF I which was held in 2012 and raised INR 411 Crore in 2012.

TCHF II has received commitments from domestic and international financial and strategic institutions including some of the global pharma, medical equipment companies, development financial institutions, and large European Institutions indicating their support for the TCHF investment strategy. TCHF II has also received commitment from the "Self Reliant India (SRI)' Fund of the Government of India, which comes under the Ministry of Micro, Small and Medium Enterprises.

Visalakshi Chandramouli, Managing Partner of TCHF, articulating the Fund's investment strategy, said, "TCHF II will seek to achieve returns by principally taking equity positions in healthcare and life sciences related companies having significant business exposure to India."

TCHF II's investment strategy is predicated to be on domestic healthcare and life sciences consumption, and healthcare and life sciences competency. The former is estimated to take up 60 percent of TCHF II's investments, while the latter will receive 40 percent of the fund.

Vamesh Chovatia, Partner, TCHF, informs that the fund has already made commitments to three companies in the areas of Domestic Pharma Formulations – Linux Pharma; Diagnostic Services- Atulaya Healthcare and Digital Health – Deeptek Inc. and expects to announce its fourth investment shortly. "The Fund has a rich pipeline of deals and is expected to continue its deal momentum in the coming months. The Fund will typically look at committing $5mn - $15mn per transaction and potentially a larger ticket size along with co-investment support from its Limited Partners who have committed to invest in the Fund," he adds.

The USD 190+ billion Indian healthcare and life sciences market is estimated to grow at a compounded annual growth rate ("CAGR") of 14% over the next five years and it represents an attractive investment opportunity.

Indian healthcare and life sciences market is the second fastest-growing market in the world. India's population of over 1.3 billion people provides a strong demand driver as there is a significant mismatch between supply and demand in the healthcare and life sciences sector. The team considers that this supply-demand mismatch, combined with the world class skill sets of India's healthcare and pharmaceutical professionals, make the healthcare and life sciences sector a compelling investment opportunity.