ValueQuest Tristar Fund raises over Rs 2,100 Cr for advanced manufacturing

ValueQuest Tristar Fund, a private equity fund that backs India’s advanced manufacturing sector, has received more than Rs 2,100 crore in commitments from investors. It reached this within 15 months of its first close, beating both its original target and the full greenshoe (the extra amount a fund is allowed to raise above its target).

The fund invests in aerospace, defence, precision engineering and manufacturing linked to the energy transition.

So far, it has backed four companies: Hi-Q Electronics makes critical circuit boards for aerospace and defence. Rangsons Aerospace builds fluid distribution systems and satellite communications equipment. Waaree Energy Storage Solutions focuses on battery energy storage. Trusted Aerospace & Engineers (TASE Global) is a precision engineering firm that serves several industries and manufactures across borders.

To pick its investments, the fund combines in-depth sector research with a mapping of industrial value chains. This helps the fund find specialised manufacturers that stand to gain from long-term industry growth and from key turning points in their own businesses.

“India is at the beginning of a multi-decade transformation in advanced manufacturing. But sector growth alone does not guarantee investment returns. The real differentiator is identifying the right businesses at the right stage of their evolution. The work we do upfront gives us the conviction to partner with strong promoters and deepen our exposure as they deliver against milestones,” said Aniket Dharamshi, Co-Founder and Managing Partner, ValueQuest Investment Advisors.

“In advanced manufacturing, competitive advantage is built over years through process expertise, rigorous customer qualification and consistent delivery on quality and reliability. Once a supplier becomes integral to a customer’s critical programs, replacing it can involve significant time, cost and execution risk. We seek businesses that can build on these capabilities to deepen customer relationships and translate industry growth into sustained, profitable growth,” said Dr. Arvind Ananthanarayanan, Partner, ValueQuest Private Equity.

ValueQuest Private Equity is also raising its SCALE Fund II, which will invest in established businesses with clear competitive advantages and visible routes to an exit for investors.

ValueQuest Private Equity is the private equity arm of ValueQuest Investment Advisors. It manages over Rs 6,000 crore across two investment strategies, three funds and co-investments. ValueQuest Investment Advisors manages about $3.4 billion across public and private markets.