IFCI Venture Capital Funds invests Rs 28 Crore in Jagdish Khattar's "Carnation Auto"
Second project to be funded under IVCF's India Automotive Component Manufacturers Private Equity Fund -1-Domestic; Former MD of Maruti Suzuki announces his ambitious plans of creating India's largest independent multi-brand auto sales and service venture.
Tweet-- IFCI Venture Capital Funds today announced its investment in Carnation Auto , a venture of Former MD of Maruti Suzuki, Mr. Jagdish Khattar.
IFCI Ventures has announced an investment of Rs.28 Crore in the project. “The country’s first multi-brand car sales and service network being set up by Carnation would enable it to provide unique and value added car sales/service network support to large-fleet owners and insurance agencies. The business model of Carnation will also help OEMs to avail optimum sales & service solutions,” said Mr. Atul K Rai, Chairman of IFCI Venture Funds (IVCF).
This is the second project funded by IFCI under its recently launched India Automotive Component Manufacturers Private Equity Fund-1-Domestic. The fund has a target corpus of Euro 60 million equivalent to Rs.396 crores and will be dedicated for investment mainly in Indian Automotive Component companies and in other related/ emerging sectors.
With a vision of developing India’s largest independent multi-brand automobile sales and service network, Carnation has announced the company’s first round of funding of over Rs.100 crore has arranged from IFCI Ventures and PremjiInvest.
New car sales are projected to be 3 million and the car park 19 million by 2015. To meet the needs of these customers, an incremental investment of Rs.15,000 crores is required in the network, which would be challenging in the existing franchise model. Upto 70% of car owners go outside of the manufactures network post warranty. Carnation would provide an alternative to these customers as well as families owning multiple brands, fleet owners and corporates- all under one roof.
Carnation will focus on providing service, mechanical repair and body shop solutions across their facilities. The service and parts markets is valued at just under Rs.15,000 crores. Carnation’s pioneering venture of setting up a chain of auto solution hubs across the country is in an advance stage of its execution plan.
Notes to Editor
About IFCI Venture Capital Fund:
IVCF is a subsidiary of IFCI Ltd. and is a public financial institution. It was promoted with the objective of broadening the entrepreneurial base in the country by providing funds to fill gaps in promoter’s contribution. IVCF has a professionally qualified team of executives with several years of experience. IVCF, with its institutional background, not only provides necessary comfort level to the entrepreneurs but also helps them during critical phases of venture.
About Carnation Auto:
Carnation Auto is an initiative by Mr. Jagdish Khattar which is in the process of setting up a state-of-the-art network of integrated multi-brand auto sales, services and related solutions across the country-an industry consolidator attempting to bring automobile dealerships under a standardized business model. Carnation will tie-up with General Insurance companies to offer their customer’s significant efficiencies and savings in claims processing. It will provide automobile manufacturers, especially those with a limited market share, or those looking for a pan-India footprint but don’t have the volumes to sustain stand alone dealerships & other capacity constraints, a more efficient route-to-market through faster nation wide retail presence, scale efficiencies and servicing support. Providing them dedicated outlets within the Carnation network resulting in higher revenues through cross-selling across business lines (new cars, servicing, used cars, accessories, financial and insurance products, auto leasing).
For further information, please contact:
Mr A K Choudhary
Managing Director
IFCI Venture Capital Funds
+91-9990725937
ak.choudhary@ifciltd.com