IFC considers $50m investment in India's Mahindra Lifespace

IFC’s investment will support one or more special purpose vehicles set up by MLDL to develop three industrial clusters in Rajasthan, Gujarat and Maharashtra. The developments are intended to provide Indian small and medium-sized enterprises (SMEs) with quality industrial infrastructure that is currently lacking in India, especially in lower-income states, according to a disclosure.

MLDL is part of the Mahindra Group, an Indian conglomerate with presence in over 100 countries and interests including real estate, aerospace, energy, industrial and farm equipment and insurance. The company operates in three main verticals, focusing on residential developments, affordable housing and large-format integrated cities and industrial clusters. It has completed more than 1.3 million square meters of projects and currently has over 800,000 square meters under development.

Along with providing working capital to allow MLDL to develop larger areas than it could on its own, IFC expects to help mobilize capital from additional long-term investors once the projects are underway to help scale up the business and accelerate growth. IFC is also collaborating with MLDL on carbon pricing and environmentally friendly development strategies and expects to extend this collaboration to the new projects.

IFC is active in India’s PE scene as an LP in funds and as a direct investor. Direct deals often focus on promoting the country’s SME community. India has 49 million SMEs – more than any other country except China – that employ 111 million people and account for 45% of India’s industrial output and 40% of its exports. However, Indian SMEs only contribute 10% of the country’s GDP, compared to 60% in China, due to a shortage of long-term funding.

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• Topics
• South Asia
• Real estate
• Industrials
• Expansion
• India
• IFC
• Growth capital