CHENNAI: When Anicut Capital set out to build an investment business more than a decade ago, co-founder and managing director IAS Balamurugan drew inspiration not from Wall Street but from Chandragupta Maurya.
“Chandragupta lost because he attacked the capital first. The lesson was to start from the periphery, build strength and then move to the centre. That’s exactly what we did,” he said, recalling the ancient anecdote that became the firm’s guiding philosophy.
Rather than competing head-on with global venture capital names such as Sequoia, Anicut chose private credit, a relatively underserved segment at the time, to establish itself before expanding into seed funding, growth equity and late-stage investments.
With the launch of four new funds in the next 12-18 months, the Chennai-based Anicut Capital’s total Assets Under Management will increase to around 6,500 crore across multiple categories as it readies itself to breach Rs 10,000 crore in assets over the next few years.
It has launched nine to 10 funds, has 16-18 portfolio companies in TN, and expects 10-12 portfolio companies to tap the public markets over the next two to three years. Its equity investments typically range between Rs 20 crore and
Rs 80 crore. Some of the investments made include Milky Mist (Perundurai/Erode), SFO Technologies (Kochi),
ASG Eyecare Hospital (Jodhpur), GNRC Hospital (Guwahati), IserveU (Bhubaneshwar) on the debt side and in Protouch (Ahmedabad) on the equity side in an early-stage deal.
Balamurugan, who spent 17 years in banking in Mumbai before returning to Chennai, said he sensed India was approaching an entrepreneurial inflection point around 2012-14.
“I could see business creation getting democratised. Education had reached an inflection point, capital was becoming more accessible and smartphones, apps and e-commerce platforms broke decades-old distribution monopolies,” he said. According to him, digital platforms enabled entrepreneurs to bypass traditional distribution networks and directly reach consumers, creating opportunities that did not exist earlier.
Anicut began by backing debt transactions in 2011-12 before formally launching what Balamurugan describes as one of India’s first homegrown private credit funds.
The firm’s investment strategy has been shaped as much by what it avoided as by what it embraced.
“When we started, we knew exactly what we didn’t want to do,” he said, adding that Anicut consciously stayed away from real estate, fintech and edtech because of regulatory uncertainties and concerns over long-term sustainability. Instead, it doubled down on lending businesses.
“Lending is the backbone of any economy. We liked secured lending and invested significantly in NBFCs. We never liked unsecured consumer lending or microfinance,” he said.
Beyond financial services, the firm has backed consumer businesses, electronics manufacturing and engineering-led companies. Nearly 30-35 per cent of its investments originate from tier-II and tier-III cities, reflecting its focus on opportunities beyond metro markets.
Looking ahead, Balamurugan believes TN’s next investment opportunity could lie in succession-led consolidation of family-owned manufacturing businesses, as many first-generation entrepreneurs struggle with succession planning.
Reflecting on institution building, he said businesses inevitably face setbacks.
“Every institution will have accidents. The idea is not to avoid them completely but to build resilience and come back stronger,” he said. The same philosophy, he added, has guided Anicut from its “peripheral” beginnings into one of India’s leading homegrown private market investors.