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With 100% FDI in defence, desi katta manufacturer appoints investment banker to get funding

02, Jun 2014 By Yatharth Ratadiya

Meerut. As soon as he heard the news that the new government could allow 100% FDI in the defense sector, Chhota Don, the local desi katta manufacturer jumped from his seat and drafted plans to take his business global.

As per the confirmed sources of Faking News, Chhota Don has approached few prominent investment banks to get PE funding for its operations. Chhota Don is a market leader in the desi katta market in central India with almost 95% market share in UP, Bihar, MP, Haryana, and other northern states.

gun factory
Small startups are going to benefit a lot from FDI in defence.

“Such firms were always major players in the overall defense sector, which includes domestic defense,” an expert pointed out, “Since the new government has promised not too overlook SMEs and small entrepreneurs, it’s logical that these guys are excited at the prospects.”

“We are very happy about the new policy for allowing 100% FDI in the sector. It shall not only allow us to legally manufacture our products, but will also help us to upgrade and expand our state-of-art manufacturing facilities,” confirmed an euphoric Mr. Chota Don, CEO and MD of his unregistered firm Chhota Don.

With fresh funds coming in, Chhota Don also plans to diversify into newer products such as grenades, rocket launchers, anti-aircraft missiles etc.

“Currently we sell our products only in India. We couldn’t even expand to Nepal, but now we are targeting overseas market of Syria and Sudan,” Chota Don said, adding a bullet point to his powerpoint presentation that he intends to send to the investment bankers.

It is believed that the opening up of sector shall also enable such domestic firms to offer new marketing platforms such e-commerce and social media. Chhota Don has registered new domain name www.desikattakart.com to start its online sales operations.

“The overall arms market in India is unorganized and diversified amongst many players. The 100% FDI move shall enable such small domestic firms like Chhota Don to access capital not only from Dubai but from other territories like Somalia. The move is a clear walk the talk by Indian government with its adage minimum government and maximum governance,” commented one of the investment banker’s privy to the development but who did not want to be named.

However, Kroor Pratap Singh, one of the ex-robbers from Chambal, expressed his disappointment over the 100% FDI in the sector. He claimed that it will end up killing many small and cottage industries in central India. He went on to compare the same with FDI in retail.

“If FDI in retail could hamper the future of lakhs of small traders, then FDI in Defense shall also hamper the interest of thousands of illegal arms manufacturers in India. This new Government is working for benefits of only big companies!” Kroor Pratap Singh said.

But barring such small protests, the arms manufacturers are happy. Experts too believe that there can be about 10 PE deals in the next 2 years with investments of about USD 5 billion flowing in such deals. It is learnt that leading PE funds such as Ceqyoa capital and India growing funds are launching dedicated defense funds for such deals.