Rakesh Kapoor, former global chief executive of consumer health and hygiene products major Reckitt Benckiser Group Plc (RB), has set up an India-focused fund with a corpus of $100 million (₹830 crore).
The new fund, 12 Flags India Consumer Fund, will invest the corpus over the next three years in consumer-focused businesses in their early growth stages, Kapoor told ET.
“The consumer fund will focus on promising, early growth businesses in India that we believe we can scale to deliver superior returns. Some of these businesses can go on to become platforms for future growth via category expansion and M&A,” said Kapoor, who led UK-headquartered RB for eight years before stepping down in September 2019.
The fund, which has already raised the money, will focus mainly on sectors including consumer health and wellness, pet and companion animal, coffee, food, nutrition, quick-service restaurants, and consumer discretionary.
“I am optimistic on India’s consumption story, underpinned by rising disposable incomes, favourable demographics, the modernisation of retail, digital adoption and stable governance with focus on infrastructural investment,” Kapoor, an alumnus of XLRI Jamshedpur and BITS Pilani, said.
The fund will provide long-duration capital to companies, invest in structurally attractive categories, and deploy additional capital to consolidate ownership, he said. It will invest early in 10-15 promising businesses initially.
Kapoor, who was associated with RB for over three decades in various management or leadership roles, is credited with turning around the company, tightening costs and inventory management at the maker of the Dettol handwash, Lysol disinfectants and Durex condoms.
He had played a key role in RB’s acquisition of Boots Healthcare International in 2006 and led its acquisition of US infant formula business Mead Johnson for $16.6 billion over a decade later. In India, he leveraged Prime Minister Narendra Modi’s Swachh Bharat programme to push RB’s hygiene brands Dettol, Lizol and Harpic, and was instrumental in RB India’s biggest acquisition, Paras Pharmaceuticals in 2010, for ₹3,260 crore.
Kapoor has set up the fund at a time when India is growing at a healthy pace even as other major economies including the US and Europe are facing a slowdown.
In a July update, the International Monetary Fund had raised India’s GDP growth forecast for the year 2023-24 to 6.1% from its previous 5.9% estimate, “reflecting momentum from stronger-than-expected growth in the fourth quarter of 2022 as a result of stronger domestic investment”. Previously, the IMF had said India overtook the UK to become the fifth largest economy in the world in the last quarter of 2021.