CESC Ventures eyes investments in FMCG space through VC enterprise

Abhishek Law Kolkata | Updated on July 20, 2019 Published on July 19, 2019

Saswat Goenka, Director CESE Ventures

RP-Sanjiv Goenka Group company CESC Ventures will invest in start-ups through its dedicated fund, RP-SG Ventures.

Investments will only be in companies that are in the FMCG and consumer goods space. A ₹300-crore venture capital fund with a 10-year tenure has already been created.

According to Shashwat Goenka, Director, CESC Ventures and son of Group patriarch Sanjiv Goenka, the company has already made two investments so far and talks are in advance stages with few other firms.

“We are in advanced stages of discussions for investments in some start-ups that are in the FMCG or consumer goods space. It is not necessary that these will be companies that we intend to acquire in the future,” he told BusinessLine on the sidelines of its AGM.

The venture has so far invested in ‘The Souled Store’, a merchandise brand that sells officially licensed products (of companies like Warner Bros, Disney, WWE and so on). Sources say The Souled Store secured $3 million-odd funding in November, with RP-SG being one of the investors.

The second investment was made in a skin and hair-care start-up mCaffeine earlier this year. A consortium of investors and RP-SG Ventures is said to have invested $2 million in the start-up. Goenka did not state the exact investments made, but said that the companies were making profits ‘on paper’.

“Not just profitability; the business model (of the start-up) and potential to succeed are the two main parameters that we look at,” he said.

According to Goenka, CESC Ventures was also planning a ₹10,000 crore turnover from its FMCG vertical over the next 5-7 years. It has currently forayed into the snacking segment through its offerings ‘Too Yum’ and ‘e-Vita; and new categories are also being explored.

The company is also open to acquisitions, especially in segments where it can leverage its existing distributing channel.

In June this year, it had acquired Herolab India, a manufacturer of ayurvedic medicines and products under the Dr Vaidya brand. “With Herbolab’s acquisition, we will have to add new distribution channels that include chemists and so on,” Goenka said.

Shareholder approval for creating a ₹100-crore provision (for CESC Ventures) has also been sought.

Spencer’s Expansion

Spencer’s, the retail arm of the RP-Sanjiv Goenka Group, will look at opening 20-30 stores across the country investing close to ₹2-4 crore across each outlet.

Spencer’s Retail was demerged from CESC Ltd as a separate listed entity.

According to Goenka, who is the additional director of Spencer’s Retail, there could be some impact of Nature’s Basket acquisition on consolidated numbers.

However, expansion plan for the latter is likely to be finalised by September-end.

Published on July 19, 2019
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