Impact investor, Lok Capital, has announced its first close on Rs 300 cr (US$40.5 million) for its third India-focused fund, Lok Fund III, bringing its total capital under management over $125 million, reports the Economic Times.

Launched last year, Fund III has a target corpus of Rs 700 cr (US$105 million) which it plans to raise within the next year to eighteen months. It will target investment tranches of between US$2 million and US$10 million over the next five years in growth stage companies in agriculture – particularly in dairy, supply chain management, and integrated “farm to fork” ventures, healthcare, and financial sectors. Unlike Fund II, it will not invest in education or renewable energy, according to the Hindu BusinessLine. The preference toward growth stage for this fund is due to insufficient returns based on the risks associated with early-stage investment ventures, according to Lok Capital Managing Partner,Venky Natarajan.

Lok made its first investment in agriculture in January of this year when it led a Rs 25 cr (US$3.7 million) Series B round for Pune-based potato supply management company, Siddhivinayak Agri Processing Pvt Ltd (SV Agri).

Lok Fund I has returned the committed capital of $22 million with an internal rate of return of 15% in dollar terms after investing in and exiting ten ventures, according to VC Circle. The firm’s second fund, Fund II has invested in 16 companies, exited five, and has returned about one third of its committed capital, according to the Hindu BusinessLine, and VC Circle reports that it is currently showing gross returns of 28% with two of its portfolio companies, Ujjivan and Equitas going public in 2016 giving Lok a partial exit.