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50 hot startups 2017

Massive Restaurants raises funds from Gaja Capital to fuel international expansion

This is the seventh investment for the Mumbai-based investor through its third fund of $240 million.
This is the seventh investment for the Mumbai-based investor through its third fund of $240 million.
MUMBAI | NEW DELHI: Mid-market private equity firm Gaja Capital has invested Rs 160 crore in premium dining platform Massive Restaurants owned by celebrity food chef Jiggs Kalra and his son Zorawar Kalra. This is the seventh investment for the Mumbai-based investor through its third fund of $240 million.

The round will see Gaja Capital pick a significant minority stake in the company with the promoters retaining their majority stake, according to people aware of the development.

When contacted by ET, Gaja Capital’s Managing Partner Gopal Jain confirmed the investment but declined to share further details on the transaction citing confidentiality.

“We have picked the premium dining route as our bet in the F&B space. We see premium dining as an opportunity of scale and we have chosen to be on the front end with Massive Restaurants. On the other hand in the QSR (Quick Service Restaurant) space we have chosen the supply chain B2B route with Baker’s Circle,” said Jain.

With this round, the total capital raised by Massive Restaurants stands at Rs 220 crore.

Massive Restaurants will use a majority of the capital to fuel its international expansion and is already on track to launch eight restaurants across 14 countries in the next couple of quarters.

“We have tasted great success in the Indian market and hence our investments are now geared towards building our international portfolio in Middle East, London and the US. Our growth strategy for restaurant expansion will be in the 2:1 ratio in favour of India, in the long term,” Zorawar Kalra, MD of Massive Restaurants told ET.

The investment in Massive Restaurants is Gaja Capital’s fifth bet in 2017, a landmark year for the private equity firm which has scored 3 exits through stake sales in TeamLease, CL Educate and John Distilleries.

Gaja Capital originally invested Rs 75 crore for a 25% stake in TeamLease through 2010 and 2011 and Rs 78 crore in CL Educate first in 2007. The PE firm is reported to have raked in returns worth 10 times and 2-3 times respectively on those investments, with an additional 4x return on its investment in John Distilleries through a partial stake sale to Sazerac in October this year.

“We have been able to demonstrate that not only has Gaja Capital managed exits but also delivered handsome returns on its investments,” said Jain declining to comment on the financials of the exit portfolio of the firm.

Gaja Capital is not alone in its stellar close of 2017 in terms of exits. 2017 has been a bumper year for private equity firms having earned $1.1 billion through exits via IPOs alone - a 25% jump from $935 million they raked in last year, according to data from Venture Intelligence.

Jain however, maintained that a strong exit performance has set the ball rolling for the firm’s investments in 2018 where it hopes to make atleast 5 investments in the consumer, education and financial services sectors.

“The venture capital ecosystem where thousands of ventures have been created and funded has created a strong pipeline for us. We are keen to carry forward our 2017 pace of investments into the next year,” Jain added.
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