CLSA Capital backs India’s Luminous Water Technologies
CLSA Capital Partners (CLSACP) has invested INR 550 million ($9.2 million) in water-purifier maker Luminous Water Technologies (LWT) from its ARIA Investment Partners IV fund.
Gurgaon-based LWT produces water purifier and water filter systems for home, residential and commercial use. In 2012 it launched "Livpure," a reverse osmosis water purifier brand for the Indian domestic market.
The products are sold through over 7,000 dealers spread across India. LWT has a large reverse osmosis water purifier manufacturing facility in Himachal Pradesh, with a production capacity of 250,000 water purifiers per annum.
The funding is to help Livpure to increase capacity, build its brand and prepare for the next phase of growth.
CLSACP has previously invested in LWT owner SAR Group's inverter and battery business, Luminous Power Technologies. It paid $20.3 million for a minority stake in 2007 and exited four years later when the company was acquired by Schneider.
Miranda Tang, CLSACP managing director said: "We worked with the founders of Livpure in the past which ended in a successful trade sale. They have demonstrated the ability to scale up consumer businesses and they have a strong desire to take this business to the next level."
The Indian water purifier market is estimated to be worth a potential INR38 billion at present, and projected to grow to INR70 billion by 2015, according to a recent study by industry body Assocham. High metal content in water sources in areas such as West Bengal, Bihar, Rajasthan and Orissa, Tamil Nadu, Andhra Pradesh are contributing to the water purifier demand in tier-two and tier-three cities.
In 2012 CLSACP's Clean Resources Growth Fund acquired a 20% stake in India's Earth Water Group (EWG) for $15 million. EWG includes industrial wastewater treatment and equipment supply companies.
Earlier this year Capvent bought a 51% stake in Morf India, a Chennai based water purification company, for an undisclosed amount. Morf has a licensing agreement to sell its products under the Kelvinator brand.
Swedish household appliances maker Electrolux has also entered the segment through a brand licensing agreement with Kent RO Systems. Other consumer companies such as Hindustan Lever and Whirlpool already offer products in the segment.
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