Monsoon Capital will reopen its $800 million flagship Monsoon India Inflection Fund next month to both new and existing investors.
The firm decided to reopen its flagship fund, which takes a private equity approach to investing in small-to-mid-cap Indian securities, because of increasing liquidity within its portfolio, “deeper conviction levels,” robust deal flow and a reduction in its cash levels.“Many of our companies have greater trading liquidity than we had anticipated and, therefore, we are now more comfortable building a more significant ownership position in them,” said Gautam Prakash, founder.
The fund closed to new investments at the end of last year.
“Since we had earlier gone through an exercise to prune the portfolio a bit, we are now down to 26 public positions. We believe we can effectively manage 30 to 35 positions in the portfolio and, therefore, we are likely to invest capital in several new companies.” Prakash added, “since our cash levels have reduced in the past six weeks due to the new investments we’ve made, we would like to build up some cash reserves.”
Prakash said that the fund is accepting another $100 million to $200 million, depending on its ability to deploy that capital in growth-oriented, value-priced securities in India, before closing again.
The fund has returned 83.3% net to investors from June 2006 through the end of last month.