Exclusive 40% ROI private deal to invest in a rapidly growing, cash generating agri business
GAMMA is an agri value chain services company looking to raise INR50mn via equity - to strengthen tech backend and scale up operations
Gamma (name changed) bridges major value chain gaps between agro-processors and marginal farmers by ensuring superior quality control, de-risked supply, and transparent price discovery
The company is a supply chain partner for 20 agro-processors, 4 input manufacturers, including marquee global names, and has a INR20mn credit line / solid relationship in place with a large private sector scheduled commercial bank
Over 8 years since commencement, Gamma has established a vast network of 200,000+ farmers across 6 states
The company achieved INR100mn in revenues as of FY21 (>5x vs prior period) and aims to clock INR500mn by FY22. Visibility on pipeline of INR5,000mn over next 3 years. Free cash flow generating
Gamma seeks INR50mn in equity financing to scale up operations and support technology backend
60% of investment round still open for subscription available at a 30% discount to valuation for Series A (imminent). Effective ROI of 40% in less than 12 months with potential upside
Ideal for individual (HNIs, professionals etc.) as well as select institutional investors (agri strategics, family offices, early stage VC). Existing investors include seasoned professionals and angels
Indian agriculture sits at an historic inflection point
Agriculture is unquestionably the largest livelihood provider in India with 60% of the country’s population depending on it. Despite playing such a vital role, traditional agri value chains continue to stay severely disorganized.
While buyers (agro processors) face quality control issues, lack of supply surety and challenges around logistics; marginal farmers suffer from limited direct access to big buyers and capital, low technical on-ground support, and heavy revenue leakage to intermediaries.
Gamma aims to maximize earnings for both buyers and farmers
Gamma is an agri value chain services company which specialises in bridging major value chain gaps between agro-processors and marginal farmers by ensuring superior quality control, de-risked supply, and transparent price discovery.
The company integrates innovative data driven technology solutions with strong operational capabilities to enable:
– Best-in-class agricultural practices for farmers
– Market-based quality produce supply for agro-processors
– Earnings maximization for both i.e.
8% lower costs of Inputs for farmers
10% higher realization on Outputs for agro-processors
Founded in 2013, Gamma has been swiftly sailing bootstrapped for some time now having achieved LTM revenue of INR100m and generating robust cash flows. The company is led by an experienced team (founder ex Mc Kinsey, IIT Kharagpur) and entrusted by advisors including seasoned agri professionals, former civil servants and industry body representatives.
Building presence with tech enabled operations at play
Gamma possesses proprietary tech-expertise and has developed end-to-end last mile linkages to enable real-time matching of bespoke agro-processor quality/supply requirements with farmer outputs, including but not limited to aggregation, storage and transportation of produce within India’s unique market setting.
Currently, Gamma operates 15 centres spread across 6 states including Rajasthan, Madhya Pradesh, Odisha, Haryana, Uttar Pradesh and Uttarakhand and has a network of 200,000+ farmers. The company is a partner to 20+ institutional entities across functions such as distribution of inputs and supply chain management, and to state govt. level entities for improving agriculture across 100+ districts.
The investment opportunity
Gamma is seeking to close its Pre-Series A round by issuing CCDs amounting to c. INR50mn ($670k) and has already received subscriptions to the extent of 40%. Usage of funds will be towards technology upgradation, product & business development, bringing new partners to the table and strengthening field teams.
The investment is estimated to generate an effective ROI of c. 40%+ in less than 12 months, subject to anticipated Series A closure. The offer is available at a c. 30% discount to the expected Series A valuation. Gamma has already received interest from a strategic player and a Development Financial Institution for its Series A.
Thanks to intense govt, private, and technological forces at-play, this is slowly changing and the Indian agriculture market opportunity is expected to double from US$760bn as of 2020 to US$1,512bn by 2026 (12% CAGR), with only a handful of players positioned to benefit from this formalisation.
The pandemic has only accelerated this paradigm shift. Broader tailwinds like these have placed agri-tech industry in a sweet spot with increasing investment activity and VC interest.
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