Kotak Special Situations Fund raised $1 billion for non-performing assets, ChysCapital got $850 million, while India Resurgence Fund raised $750 million for structured debt, amongst others.
Says a top executive of a leading PE firm: “The reason is simple. Global investors in PE funds have seen return in multiples of 2.5-3 times in India in funds that are four- to five-years-old. With stability in substantial upside in exits they are willing to invest more into India focused funds or those with a substantial India presence”.
This does not include Asian funds raised by global PEs looking at earmarking anything between 20-30 per cent of their cash into India say key global PE players. They say the top 10 global PE funds have raised around $50 billion in Asian funds, which are for classic equity (others are raising VCs and for infrastructure projects of similar amounts).
They project that every year about $40-50 billion is available through these funds for investing in India. A global PE fund’s managing director says, with China having a strong domestic lead PE players market, many Asian funds that are raising huge sums have to look at India, which is a key market.
“The economy might be slowing down, but that offers opportunities for buy-outs at a lower price as well as more companies looking for funds. We currently look at offers from as many as 200 Indian companies, which is a new high, though we only narrow it down to 20-30 of them,” said the MD.
Sovereign and pension funds are also pushing more aggressively in the country. This is reflected in the fact that they put in $10.9 billion last year, again a record. This constituted 23 per cent of total PE and VC investments in 2019 says Ernst & Young.