Lok Capital IV LLCStatus: Approved investment
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Who is our customer
Lok Capital IV LLC (the "Fund", "Lok IV") is the fourth India-focused private equity fund raised by long-standing FMO relationship Lok Capital. The Fund combines a focus on growth equity investments in more traditional financial services and FinTech companies with investments in earlier stage deals in the AgriTech, HealthTech, and ClimateTech space. In line with its predecessor funds, Lok IV will make investments in private companies in India, with inclusion-themed investments in the FI sector making up the core of the portfolio.
What is our funding objective?
FMO intends to commit to the Fund at First Close to support its fundraising and allow it to reach its target fund size of USD 150-180mln. The Fund seeks to generate positive financial returns and positive impact from making investments in both growth and earlier stage (Series A+) investments in small and medium-sized companies in the above-mentioned sectors in India.
Why do we fund this investment?
The Fund targets investments in several focus sectors and impact themes - including financial inclusion and climate action - for FMO. The investment will allow FMO to keep supporting a trusted local partner with an explicit impact focus in one of its core markets. Lok IV will also be eligible to apply under the 2X Challenge as Flagship Fund.
What is the Environmental and Social categorization rationale?
E&S risk is considered Medium (Cat. B) based on Lok IV’s investment strategy and E&S risk profile and size of targeted investments. Besides investments in growth stage financial services and earlier stage FinTech companies, the Fund will make earlier stage investments in the AgriTech, HealthTech, and ClimateTech space. Key risks that are triggered in targeted sectors are mostly related to IFC-PS 1-4 (E&S risk management, labour and working conditions, resource efficiency and pollution prevention, community health & safety). IFC-PS 5-8 are less likely to be triggered, as the Fund will focus on asset-light tech-enabled/tech-first business models and not invest in companies with extensive physical infrastructure. FMO and other DFIs will continue to monitor the E&S performance and E&S capacity within the team to ensure that the Fund Manager remains adequately equipped to invest in these sectors throughout the Fund's life.
- Financial Institutions
- Publication date
- Effective date
- Total FMO financing
- USD 20.00 MLN
- FMO NV
Risk categorization on environmental and social impacts, A = high risk, B+ = medium high risk, B = medium risk, C = low risk
Environmental & Social Category
(A, B+, B or C)