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NEEV Fund of SBICAP Ventures, an alternative asset manager and subsidiary of SBI Capital Markets, has made an investment of $5 million in a biomass management company Punjab Renewable Energy Systems Pvt Ltd (PRESPL).
PRESPL supplies biomass such as paddy straw, cotton-stalk, soya-husk, maize-cob, mustard stalk to biomass-based power plants and various process industries for energy or conversion into biofuels. It has a capacity to handle a supply of over 1,000 MT of biomass per day.
“We are pleased to be associated with the Neev Fund as this will help us scale the business and expand into other geographies – especially India’s less developed states,” said Monish Ahuja, Managing Director of PRESPL.
The $5 million investment by Neev fund is the first in the Series-B funding round, in which the company is targeting to raise $8-10 million, Ahuja told BusinessLine . The process for raising the remaining amount is in advanced stage, he added.
India produces over 145 million tonnes of surplus biomass every year, which is usually burnt in the fields resulting in major air pollution.
According to Manav Bansal, Chief Investment Officer of the Neev Fund, even though power plants and various industries could use biomass to produce power, the continual availability of biomass remains a challenge.
“PRESPL will address this market barrier by guaranteeing biomass supply throughout the year by empowering Village Level Entrepreneurs (VLEs) and farmers,” he said.
The companies have not disclosed the details of investment. The deal with PRESPL marks the tenth investment for Neev Fund and fourth in the clean energy sector.
Neev fund is an infrastructure private equity fund focussed on creating sustainable development, backed by SBI and the UK Government’s Department for International Development (DFID) .
The fund’s mandate is to invest in eight low income/developing states in India, such as Bihar, Chhattisgarh, Jharkhand, Madhya Pradesh, Odissa, Rajasthan, Uttar Pradesh and West Bengal with a focus on infrastructure sub-sectors like renewable energy, agricultural supply chain, healthcare, education, urban infrastructure and roads.
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