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Private Equity

Private equity (PE) simply means equity securities in private companies - the companies that have not floated their shares in the market. Normally, HNIs and UHNIs can invest their funds directly into these private companies and acquire significant stakes in them... Private equity (PE) simply means equity securities in private companies - the companies that have not floated their shares in the market. Normally, HNIs and UHNIs can invest their funds directly into these private companies and acquire significant stakes in them. Such investments are targeted at expanding the scale and increasing the efficiency of your investments by investing in companies and their subsequent sale or floating on the stock exchange. Here the strategic goals involve achieving gross high returns in the medium to long-term, in a focused time horizon by closely participating in the operations and value addition of the target private equity companies. Private equity has gained a lot of attraction as an asset class because of the perceived high returns and opportunities that come with it compared to the listed securities in the markets. See More See More

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Key Features of Private Equity Offered by Anand Rathi

Anand Rathi Private Client Group is your trusted specialist partner for Private Equity Investments. Private equity companies are specialists for high-net-worth individuals (HNIs) and Ultra high-net-worth individuals (UHNIs). We manage their portfolio risks and provide access and assistance for premium deals. Some key features of our private equity offering include:

Diverse Investment Strategies

Diverse Investment Strategies

Our investment modalities include direct investments and fund-based investments across technology, health care, infrastructure and consumer product sectors.

Experienced Management Team

Experienced Management Team

Our team of veteran market experts recognizes potential markets and creates strong value-creation strategies to develop impressive returns.

Exclusive Opportunities

Exclusive Opportunities

Through our industry network and market analysis, we offer quality deals that may not be easily accessible elsewhere.

Rigorous Due Diligence

Rigorous Due Diligence

Risk assessment is extremely important to us and we go through research and analysis to determine the viability of the investment to avoid risking our HNI clients’ money.

How Does Private Equity Work?

PE firms attract funds through institutional and wealthy investors to use in private companies. These investments are typically made in various companies, from emerging start-ups to small caps, midcaps, and large caps, and in post-development concerns that need restructuring or expansion. Here's a breakdown of the process:

Fundraising

Fundraising

The PE firms obtain capital by aggregating a pool of money from investors, who are willing to explore more opportunities than investing in common stocks.

Investment

Investment

HNIs and UHNIs can invest in different business entities where they can acquire a significant stake in those PE companies to financially support their expansion or even alter their methods of operation with the aim of improving performance. This can allow for very fruitful investments.

Value Creation

Value Creation

PE investment allows you the opportunity to invest in companies with enhanced organizational performance, management, and business models of an involved organization. This helps to unlock the value of your investment in these Private Equity Companies.

Exit

Exit

Investors can the reap benefits of their PE investment, after some years, when the PE firms exit investments through a process of disposal such as a sale to another company or through floating in the stock exchange or re-buying out by another PE firm.

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Why Choose Anand Rathi for Private Equity

Our Private Equity offerings at Anand Rathi PCG are unique because of our focused approach to delivering sustainable value. We differentiate ourselves through:

Expertise & Experience

Expertise
& Experience

Our PE experts have many years of experience in the identification and management of private equity investments across sectors.
Customized Solutions

Customized
Solutions

To this end, we offer customized, requirement-based PE solutions for our clients with risk tolerance, meeting their financial objectives, with exceptional freedom of choice.
Risk Mitigation Strategies

Risk Mitigation
Strategies

Our diversified research function minimizes the risks and optimizes returns, benefitting the investment portfolio of our esteemed clients.
Network & Deal Flow

Network &
Deal Flow

With our unique approach, we use our solid network and market analysis to offer the best PE investment deals for our clients.

Benefits of Private Equity?

Private equity offers several potential advantages to investors, including:

High Return Potential

High Return Potential

PE investments have the potential to generate higher returns compared with ordinary assets such as equities and bonds, if they can successfully manage their risks.

Diversification

Diversification

PE provides investors with an opportunity to diversify since the ability of returns generated from PE investments is often not directly linked with the performance of the public markets.

Access to Growth Opportunities

Access to Growth Opportunities

The idea of investing in early or mid-growth companies means that investors get an opportunity to get involved in highly growing sectors and industries.

Active Management

Active Management

Buy-out companies are engaged in the management of portfolio companies to ensure they unlock value and serve as catalysts for better operational, financial, and organizational outcomes.

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How Can Anand Rathi PCG Help?

At Anand Rathi Private Client Group (PCG), we offer a set of focused services to HNIs and UHNIs who are looking for private equity investment. We offer:

Personalized Consultation

Personalized Consultation

With an understanding of your investment objectives, risk tolerance, and available funds, our advisors assist in choosing the right PE opportunities.

Portfolio Management

Portfolio Management

We use PE only in combination with other investment tools for wealth management to achieve diversification and the highest possible growth rate.

Ongoing Monitoring & Reporting

Ongoing Monitoring & Reporting

We consistently report updates and research on the returns of your private equity companies' portfolios.

Exit Strategy Planning

Exit Strategy Planning

We participate in the identification of the best exit strategies to provide good returns with a close eye on the risks involved.

FAQs

Private equity can be classified into several types based on the nature of the investment and the stage of the company:

  • Venture Capital (VC): Focusing on young and high-growth businesses with high growth capability.
  • Growth Equity: Offering money to large businesses for a business expansion or when they want to reorganize their operations.
  • Buyouts: Purchasing a stake in a firm in order to enhance its operations and or management team up.
  • Mezzanine Financing: A combination of loan financing and share financing, arranged for the purpose of financing the growth or acquisition of the firm but without relinquishment of control.
Our private equity services are tailored for institutional investors, affluent consumers such as HNIs and UHNIs interested in diversified investment instruments, and exclusive access to the offers. That is why we have tailor-made services based on your target financial objectives and your tolerance to risks.
Our Private Equity Firms Investments services are intended for HNI and UHNI investors. However retail investors can get into private equity firms' funds with a piece of professional advice from an expert PE advisor.
The minimum ticket size for private equity also depends on those structures but generally, the individuals are expected to invest as low as INR 5-10 lakhs through funds. If the investments are direct investments or greater, then there is a need for higher investments.

The Rule of 72 is a practical technique for evaluating investment time to double such investment when compounded at a specific rate annually. The rule is as follows:

For instance, if, for example, the expected return on a private equity investment is at 0.12 or 12% per year, then the investment will take about 6 years to double (because 72/12 is equal to 6).

While both venture capital (VC) and private equity (PE) involve investing in private companies, they differ in terms of the target stage of the company and the investment strategy: Venture Capital (VC) is primarily involved with young companies with high growth possibilities, including such industries as technology. Private Equity (PE) usually refers to stable companies that are usually established to afford acquisitions, with distinct goals of rehabilitating, improving, or expanding the acquired businesses.

Private equity investments come with a higher level of risk compared to public equities or bonds, including:

  • Liquidity Risk: PE investments cannot be sold frequently and mostly have a long investment time span.
  • Market Risk: Under certain circumstances, pressures such as economic instability, cyclical fluctuations, and volatile market movements or declines affect the operations and returns of the portfolio companies.
  • Management Risk: The ability of PE investments to deliver good returns is now being attributed to the skill of the management in implementing and delivering business strategies.
A private equity investment instrument’s average holding period is 4 to 7 years. In this period, the PE firm ensures that the company in its portfolio has enhanced its operating efficiency as well as its financials so as to achieve a viable exit strategy like a sale, floating of its equity, or any other way.
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