Agri-investment comes with risks. Look at Growpital

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₹5,000 and also allows non-resident Indians (NRIs) to invest. Despite having been in existence for six years, the firm started collecting money from the public only in the last two years. It has raised approximately ₹70 crore, which has been deployed over an area of more than 3,000 acre of land.

Currently, over 2,000 investors have subscribed to this platform, according to the firm. Since the returns are in the form of agricultural income, they are exempt under the Income Tax Act, 1961, in India. As a result, the income in the hands of investors is also tax-exempt.

However, there are certain risks that investors need to take note of due to its operating structure. Here, we outline how Growpital works, based on information from its website and an interaction with its founder, Rituraj Sharma, and highlight the potential risks associated with such investments. Growpital is an agricultural investment platform that claims to offer tax-free fixed-profit sharing to investors ranging from 10% to 15% on investments.

The funds are invested in agricultural project portfolios, where investor capital serves as working capital for farming. The platform manages farm projects either through an in-house team or by partnering established market players. The firm ties up with farmers and provides standard operating procedures to them on farming.

Growpital compares itself to a mutual fund, with diversified crops being grown across farm projects. It utilizes funds to take lands on lease in different parts of the country and develop the basic minimal infrastructure, which can be used for irrigation. By selling the crop produce, the firm earns revenue.