07 June, 2021 / Published in Dossiers on RE-Infra

Northern Arc Investments

Funds managed

IFMR FImpact Investment Fund
IFMR FImpact Long Term Multi Asset Class Fund
IFMR FImpact Medium Term Microfinance Fund
IFMR Fimpact Long Term Credit Fund
IFMR FImpact Medium Term Opportunities Fund
IFMR FImpact Income Builder Fund
Northern Arc Money Market Alpha Fund (IN/AIF3/18-19/0601)
Northern Arc India Impact Fund (IN/AIF2/18-19/0661)
Northern Arc Income Builder Fund – Series II (IN/AIF2/19-20/0767)

About

IFMR Capital was re-branded as Northern Arc Capital in 2018. The new brand signifies the company’s renewed commitment to its mission of providing access to finance for the under-banked in India, across sectors like microfinance, small business loans, affordable housing finance, vehicle finance and agri-finance.

As part of re-branding, IFMR Investment Managers, the subsidiary of IFMR Capital, an alternate investment fund vehicle, is now known as Northern Arc Investment Managers.

Northern Arc Capital is backed by Dvara Trust (formerly IFMR Trust), LeapFrog Investments, Eight Roads Ventures and Standard Chartered Private Equity.

Key staff

Kshama Fernandes (Managing Director & CEO) – Dr. Fernandes has been associated with Northern Arc Capital Limited since its inception in 2008. She has extensive experience in capital markets, and has been previously involved in financial advisory, consulting and academia. Prior to joining Northern Arc Capital Limited, she was a Professor and Head of Finance at the GIM. She has worked on consulting assignments for the World Bank, the Chicago Mercantile Exchange, the Government of India (Ministry of Finance), and NSE.IT, and was a core committee member of the Percy Mistry Committee on ‘Making Mumbai an International Financial Centre’. She has also developed the SEBI mandated certification programme for derivatives for the National Stock Exchange and NCDEX. She graduated with an MBA and holds a Ph.D in Finance from Goa University and has a Bachelor’s degree in Mathematics. She is also a certified Financial Risk Manager.

Ravi Vukkadal (CEO) – Ravi has over 16 years’ experience in credit investing, risk and fund management. Prior to joining Northern Arc, he was part of the Fixed Income investment team at Invesco Mutual fund overseeing credit and rates assessment. His capital market experience also includes stints with companies such as Bharti AXA Investment Managers, JM Financial Ltd, and Merrill Lynch. He is a Chartered Financial Analyst (CFA Institute) & Financial Risk Manager (GARP) and holds a Post Graduate Diploma in Finance from NMIMS (Mumbai), Masters in Management & Information Systems from Virginia Tech (US) & Bachelor of Chemical Engineering from University of Mumbai.

Kalyanasundaram. C (CFO) – Kalyan is the CFO for Northern Arc Investments. He has over 21 years of experience in financial management, accounts, audit, systems and operations. He has been part of the Northern Arc group since 2009. Prior to joining Northern Arc, he worked across several industries in various functions in India and overseas. He has a bachelor’s degree in Law & Commerce from University of Madras.

Investment Philosophy

It is centred around making impact-oriented yet returns-focused investments in a number of key financial-inclusion themed sectors, including Microfinance, Affordable Housing, Small Business Loans, Vehicle Loans, Agri-business Loans and Consumer Finance.

It claims its USP as –

One of the very few private debt fund managers operating in this space
Several innovative measures to provide investor comfort including meaningful levels of first loss protection to mitigate credit risk; currency hedging services to counter exchange risk
Unparalleled connect with high-quality on lending organisations across India
Consistent and demonstrated track record in outperforming target returns across all funds
End-to-end experience across the funds’ life cycle: fund-raising, investing and complete exit
Proprietary social impact measurement tool to ensure transparency in impact reporting and measurement
Internal process well integrated with ESG and UNSDGs
High-touch operational model with portfolio entities with detailed post-investment monitoring at periodic intervals

IFMR FImpact Investment Fund

Source: http://aif.ifmr.co.in/wp-content/uploads/2014/11/IFMR-FImpact-Investment-Fund_Brochure.pdf

Objective: To promote financial inclusion in India by facilitating development of the Indian microfinance sector. To achieve this, it invests in various securities of Microfinance Institutions (MFIs) and its underlying assets.

Investment Process:

Investment Strategy: Enable funding to first time borrowers and provide senior secured and subordinated debt in the form of non-convertible debentures (NCDs). Aim to fill the gap in the capital structure for MFIs by providing medium to long term debt.

IFMR FImpact Long Term Multi Asset Class Fund

Objective: Investing in a mix of microfinance, small business loan finance, affordable housing finance, commercial vehicle finance and agribusiness finance debt for the medium to long term.