Piper Serica targets a larger, ₹500 cr AIF
China’s Xiaomi has secured locked-in orders for more than 70,000 of its SU7 electric cars as of Saturday, and the company intends to keep its automotive business “100% focused” on the Chinese market for the next three years, founder Lei Jun said on Tuesday.
The smartphone maker is targeting more than 100,000 deliveries for the SU7 in 2024, he said in comments at an investor conference.
Locked-in orders refer to those where buyers have opted for non-refundable deposits. ‘
Xiaomi launched its car, which draws styling cues from Porsche, late last month. It enters a crowded China EV market with an attention-grabbing price tag - under $30,000 for the base model, which is $4,000 cheaper than the base model of Tesla’s Model 3 in China.
The company has said it expects to lose money on the SU7. Lei noted on Tuesday that most of its suppliers also supplied the likes of Mercedes Benz, BMW and Audi.
“With such expensive suppliers and such expensive parts, the gross profit margin will not be very high,” he said.
“I estimate that the gross profit margin will be around 5-10%,” he said, adding that Xiaomi was discussing increasing production capacity and further cost support from suppliers. Better known for making affordable smartphones and home appliances, Xiaomi intends to invest another 11-12 billion yuan this year in new businesses, including the automotive unit and the operating mobile system for its phones, Lei said.
Ultimately, his goal was for Xiaomi to become one of the top five automakers globally in 15-20 years, he said.
Mumbai-headquartered asset manager Piper Serica Advisors Pvt. Ltd is set to launch a larger closed-end investment vehicle than initially planned. It has also doubled the capital raised for its angel fund, founder and director Abhay Agarwal said.
In January, the asset manager planned to launch a ₹250-crore category-II alternative investment fund by mid-2024, VCCircle had reported. Now, it is considering a larger fund with a target corpus of about ₹500 crore, along with greenshoe option of ₹250 crore.
According to Agarwal, Piper is currently drafting its private placement memorandum and is expected to file it with Securities and Exchange Board of
India (SEBI) soon. Piper Serica will primarily target institutional limited partners for the AIF to raise the target corpus, he added.
As and when the asset manager decides to tap the greenshoe option, it may also reach out to family offices, high-networth investor, as well as ultrahigh-net-worth individuals.
With a bigger target corpus, it is targeting cheque sizes ranging ₹25 crore and ₹75 crore, and aims to invest in startups at the Series A to preSeries B stages, Agarwal said.
Piper Serica, which raised around ₹160 crore for its category-I fund in July 2023, has informed the regulator about raising additional capital for the vehicle following positive investor sentiment and strong dealmaking pace. So far, it has raised about ₹350 for the angel fund, and does not plan to raise further capital for this vehicle.