India In Sight #02
India In Sight #02
Weekly updates on Indian private markets
We are Ambassador Capital Partners, an investment firm with a focus on private credit and private equity. Deeply embedded in the private markets ecosystem, ACP works with large global institutions to provide creative capital solutions for companies and asset managers.
In the spirit of making Indian private markets more accessible and transparent to global LPs and GPs, we have launched ‘India In Sight’ – consolidating and curating relevant information and insights from Indian private markets including trends, key deals, fundraises, KPIs and top tier research.
Subscribe to receive the newsletter every week in your inbox!
Stay tuned, Stay ahead!
Key Deals
Private Equity
PremjiInvest, the family office of Wipro founder-chairman Azim Premji, acquired a 9.7% stake in TVS Credit Services, the lending NBFC arm of TVS Motors, a two-wheeler company, for c.$90 million. The transaction involves a combination of primary capital infusion into TVS Capital and a secondary share purchase. (June 10, 2023)
Bain Capital acquired Porus Labs, a Hyderabad-based specialty chemicals company. The estimated deal value could be around c.$300-360 million. (June 08, 2023)
PAG acquired a significant minority stake in RK Pharma, a specialty injectables company for a total deal size of c.$200 million. (June 06, 2023)
Course5 Intelligence, a data analytics startup, closed its first external funding round at $53 million at an estimated valuation of $250 million. It raised $28 million from 360 One Asset Management in the first tranche and $25 million in second tranche, led by Nuvama, with participation from Carnelian Asset Advisors. (June 06, 2023)
Credit
State Bank of India, India’s largest lender, will raise c.$6.1 billion through debt instruments from Indian as well as overseas markets in the current financial year. (June 09, 2023)
Torrent Power, an integrated power utility company, raised c.$75 million via Non-Convertible Debentures (NCDs) at a coupon rate of 8.50% p.a. on private placement basis. (June 08, 2023)
IIFL Finance, an NBFC micro finance company, will raise c.$180 million via secured NCDs. The bonds will offer an effective yield of 9% p.a. for a tenure of 60 months. (June 06, 2023)
SBI Cards, a leading pure-play credit card issuer in India, will raise $360 million via NCDs in one or more tranches, on a private placement basis. (June 05, 2023)
Key Funds and Fundraises
BlueOrchard, a Swiss impact investment firm, received a $6 million commitment from the European Investment Bank for its InsuResilience Fund II (IIF II). The fund was launched in April last year and has a target corpus of c.$100 million. (June 09, 2023)
Waterfield Advisors, an India-based wealth management company, is looking to raise c.$250 million for its second fund of funds as the company plans to launch a new segment for its key clients. (June 09, 2023)
Sequoia India and Southeast Asia will rebrand as Peak XV Partners with $2.5 billion dry powder as Sequoia is separating its US, China and India- Southeast Asia businesses into independent firms. (June 06, 2023)
Brookfield India REIT is looking to raise $400 million in equity, and is targeting the deal's closure by July. (June 05, 2023)
Market Insights and Research
Articles
Indian issuers raised c.$43 billion in green bonds from January 2014 to March 2023. Domestic power producers accounted for c.80% of the green bonds in India with Greenko, ReNew, Continuum, NHPC and Adani Green among the top five issuers. Read more.
An increasing number of VCs are shifting their focus to theme-based investing. Over 220 new startup funds with $30 billion+ in fund corpus were announced between January 2021 and May 2023, of which 35%+ (77 funds) were thematic. Read the latest insights by Inc42.
There are four trends reshaping the future of private debt: mainstreaming of private debt as an asset class; the evolution of business models to enhance competitiveness; the emergence of innovative sub-asset classes within private debt; and, increasing integration of ESG considerations. Read more.
India’s economic and demographic outlook points to strong growth over the next decade and suggest Indian equities could over-perform main equity markets. Investor sentiment is shifting to value stocks, cyclical industries, and mid- and small-caps. The outlook for fixed income is also favourable, with potential for positive real returns. Read the latest insights by Amundi Asset Management.
The monetization of public-sector brownfield assets unlocked capital worth c.$17 billion in FY2023, up 44% vs c.$12 billion in FY2022. Coal blocks and other mineral assets, highway stretches and power transmission lines contributed significantly to the monetization. Read more.
Emerging Asia has the foundations in place to deliver economic outperformance to 2050 and beyond and India could become the 4th largest economy by early 2030s. Read more in this piece by Abrdn.
Quick View:
CPPIB’s India Portfolio: c.$16bn (+$1.8bn in FYE Mar-23, 2x+ in 3 years). Recent investments include:
$425m: VerSe Innovation, local language video app
$270m ($700m till date): Renew Energy, renewables platform
$325m: Tata Realty, commercial real estate platform
$200m: Indospace, logistics and warehouse operator
$400m: Indiainfravit, roads focused InvIt
$225m: Kotak infra fund
$120m: Sajjan India, agro chemicals company
Some previous investments include:
BPEA mid-market credit fund
India Resurgence fund, distressed
Reports
According to the ‘India e-Conomy Report 2023’ by Google, Bain and Temasek, India's internet economy is poised for significant growth, with a projected value of $1 trillion by 2030. The adoption of digital tools and services, driven by evolving consumer needs, presents immense opportunities across sectors such as e-commerce, fintech, edtech, and more.
RBI kept the policy rates unchanged with the benchmark lending rate at 6.5% as it remained cautious on inflationary risks going forward. Read the latest report by ICRA on RBI’S second bi-monthly monetary policy meeting for 2023-24 and its hawkish stance amid focus to contain inflation within 4.0% CPI target.
Read the latest ICRA Research compendium (May 2023) which offers a summary of latest data and reports released last month across various sectors.
ICYMI
Byju’s defaulted on $40 million loan payment on a $1.2 billion loan after a dispute with lenders, escalating a conflict that could jeopardize the future of one of India’s major edtech startups.
IndiGo, one of the leading airlines in India, to buy 500 jets from Airbus. This comes after Air India's provisional purchase of 470 jets from Airbus in February 2023.
India will offer c.$450 million in incentives to companies setting up battery storage projects totaling 4,000 megawatt hours (MWh). The scheme is intended to boost battery storage projects critical to achieve India’s plan to expand its renewable energy capacity to 500 gigawatts (GW) by 2030.
Electric vehicle maker Ola Electric is planning a late 2023 IPO listing and plans to raise $600 million to $1 billion from the IPO. It plans to file its DRHP by August 2023 and has appointed Bank of America as the lead manager for the IPO.
India and the UK concluded their 10th round of negotiations on free trade agreement (FTA) with detailed discussions on the key aspects of the proposed deal.
Key Indicators
The unemployment rate in India fell to 7.7% in May vs 8.5% in the previous month.
India's life insurance companies collectively saw a decline of 4.1% YoY in new business premium income for May 2023, amounting to c.$2.9 billion. LIC saw a 11.3% decline while the other 23 private players saw their combined new business premium rise by 9.1%.
India's fuel consumption rose by 8% MoM (9% YoY) in May to c.20 million tonnes. This is a new record high in the month of May.
Palm oil imports by India fell to c.441k tonnes in May, down 14% from c.510k tonnes in April. May imports were the lowest since Feb 2021 as demand shifted to cheaper alternatives like soya and sunflower oil. The decline in purchases could weigh on palm oil prices, which are already trading near their lowest level in 30 months.
India’s services sector growth eased slightly in May as the services Purchasing Managers' Index (PMI) declined to 61.2 from 62.0 in April. This is the 22nd consecutive month where services PMI has come in above 50 and second-strongest rate of growth in c.13 years due to favourable demand conditions and new client wins. The composite PMI for May was unchanged from April at 61.6.
India’s coal production increased by c.7% YoY to 76.13 MT in May 2023 from 71.21 MT in May 2022.
E-way bill generation, a tracker for movement of goods on the ground, increased by 4.5% MoM to 88.2 million in May 2023. This is seen as a positive indicator for increased economic activity.
Weekly Market Update (w/c June 05, 2023)
Thank you for reading India In Sight!
Read our other editions here.
Disclaimer:
The content provided on this platform contains references and links to external sources, including articles, reports, websites, images, or videos. We do not own or claim copyright over the content found in these external sources. The ownership and rights of the content belong to the original creators.
The content, specifically regarding markets, is intended for informational purposes only and should not be construed as investment advice.