Skegen Asset Management, backed by Bharat Biotech’s promoters, is launching a new ₹3,000–5,000 crore fund to invest in Indian manufacturing startups. This second fund marks a strategic shift to include institutional investors alongside the founding family, focusing on capital-intensive physical businesses.
Skegen Asset Management LLP, an investment firm supported by the promoter family of Bharat Biotech, is planning to raise a second fund with a target corpus of ₹3,000 crore to ₹5,000 crore. This fresh pool of capital is dedicated to supporting Indian manufacturing startups. The firm's move reflects a continued belief in the growth potential of physical production sectors as opposed to service or software-led businesses.
This development marks a structural evolution for the firm. While the debut fund of approximately ₹2,500 crore was funded exclusively by the promoter family, the new vehicle aims to attract institutional investors. The founding family will continue to act as a significant partner, but the inclusion of external institutional capital indicates a move toward a more diversified and professionally managed investment model. Raches Ella, the chief development officer at Bharat Biotech and a member of the founding family, confirmed that the firm is preparing to deploy this larger, second fund.
Strategic Focus on Tangible Assets
The fund’s investment philosophy centers on manufacturing and tangible assets. According to the firm, businesses with physical assets are more resistant to the rapid, often disruptive changes seen in AI-driven or software-based industries. By backing companies involved in advanced materials, defense technology, and precision engineering, Skegen seeks to build value over a longer time horizon, often anticipating a three-to-five-year period before these portfolio companies consider an initial public offering.
The track record of the first fund serves as a template for this strategy. The firm previously invested in companies such as Sagar Defence Engineering, which has initiated its IPO process, and Raghu Vamsi Machine Tools, which is also planning a public listing. Other notable portfolio entities include advanced materials firm Midwest Ltd and B2B manufacturer Continental Coffee. Skegen’s strategy involves taking a 10-25% stake in these companies, providing not just capital but also market access through Bharat Biotech's existing global distribution network across 120 countries.
Investor Context and Risks
It is important for market participants to understand that Bharat Biotech is a private company and is not listed on any Indian stock exchange. Consequently, this fundraise by Skegen Asset Management is a private venture capital initiative and does not provide an avenue for retail investors to buy shares in the firm or its portfolio companies.
The risks inherent in this type of investment include the illiquidity of unlisted manufacturing assets and the long duration required for capital recovery. Furthermore, as the firm transitions from a purely family-backed model to one involving institutional investors, it will face increased scrutiny regarding performance, governance, and fund management. Success for this new fund will depend on the firm’s ability to scale manufacturing businesses, manage operational costs, and execute successful exit strategies for its portfolio companies.