India In Sight #20
India In Sight #20
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.
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KEY DEALS
Equity
[Exit] Venture Highway, a domestic early stage venture capital firm, sold c.1.5% stake in Meesho, an e-commerce unicorn, at an estimated valuation of c.$3.5 billion, to Westbridge Capital (translating to over 50x MOIC). (October 13, 2023)
IFC to invest c.$40 million in Sunteck Realty, a domestic real estate developer, for 4-6 green housing projects in suburban Mumbai. This is IFC’s second partnership with Sunteck Realty this year. (October 11, 2023)
InsuranceDekho, an online insurance aggregator, raised c.$60 million in Series B funding led by Beams Fintech Fund, Eurazeo and Mitsubishi UFJ. Existing investors include TVS Capital, Goldman Sachs PE and Avataar Venture Partners. (October 11, 2023)
US DFC invested c.$35 million in SAEL Industries, an agribusiness and green energy company, as a part of its plans to invest $50 million in the company. (October 10, 2023)
[Expected] Amagi, a media technology firm, is looking to raise c.$250 million from its existing and new investors in a new funding round. Existing investors include General Atlantic, Accel, Avataar Ventures and Norwest. (October 10, 2023)
Credit
Zolve, a cross-border neobanking startup, raised $100 million debt facility from Community Investment Management , a US-based impact investor. (October 11, 2023)
Other Deals and Issuances
The Hinduja Group, a prominent Indian conglomerate, is looking to raise c.$800 million from private credit funds to support their potential acquisition of Reliance Capital. (October 10, 2023)
RBI is considering the sale of government bonds worth c.$6 billion with the aim of managing banking system liquidity. The bank may resort to open market operations (OMO) as a mechanism to regulate liquidity. (October 10, 2023)
InCred, an NBFC, raising c.$40 million via public issue of NCDs; Bank of Baroda raising c.$1.2 billion through the issuance of long-term infrastructure bonds.
KEY FUNDS AND FUNDRAISES
RV Capital, a Singapore based hedge fund, marked the first close of its maiden India-focused private credit fund, at c.$12.5 million. The fund aims to raise c.$50 million targeting returns of 14-16% in INR. (October 12, 2023)
Jungle Ventures, a Singapore based early stage VC firm, launched First Cheque@Jungle, its platform for seed investment in emerging startups in India and Southeast Asia and will be investing out of its current $600 million fund. The firm plans to allocate 50% of the investment for equity, and 50% into no-cap convertible notes. (October 11, 2023)
MARKET INSIGHTS & RESEARCH
Articles
In the first nine months of 2023, Investment banking fee in India reached c.$970M in first nine months of 2023, up by 41% yoy, marking the highest fee collection since 2000. While India-bound M&As were down by 57% to a three-year low, the number of deals grew by 3% yoy. Read more.
The government plans to modify the Insolvency and Bankruptcy Code, aiming for project-specific resolutions for real estate firms. This will prioritize resolving specific distressed assets, ensuring that completed projects aren't unnecessarily pushed into insolvency. Read more.
In 2023, India marked a pivotal shift towards self-reliance in strategic mineral resources with revelation of a 5.9 MT lithium deposit in Jammu and Kashmir. AZB’s piece helps to navigate the new laws that attract specialized global exploration firms, allowing them to delve into India's rich mineral terrain. Read more.
Reports
The ‘State Of Indian Fintech Report, Q3 2023’ report lays out the trends in the Indian fintech market that has has witnessed substantial investment, accumulating over $27B from 2014 to mid-2023. Estimated market opportunity at $2.1T by 2030, with 60% market to be driven by lending tech. [Paywall]
Assessing the GST impact on various Indian consumer groups is challenging due to the multiple rate structures. NIPFP working paper provides insights on the distributional impact of GST in India.
Domestic air passenger traffic in Sep 2023 down by 1.3% vs Aug 2023, but rose by 19% yoy. ICRA report on the Indian Aviation Industry maintains a stable outlook for the Indian aviation sector, expecting the recovery trend to continue.
Amid global challenges, transformative investments in emerging markets can drive sustainable growth. Multilateral development banks (MDBs) are pivotal in fostering these investments, offering knowledge, financing, and risk management. ‘The Triple Agenda’ report by The Independent Expert Group seeks to focus on the strengthening of MDBs with a vision set for 2030.
CII Insights: Detailed reports on opportunities arising from India’s transition to digital economy, significant opportunity to to emerge as a ‘world class manufacturing hub’ for the Indian automotive industry and insights from 124th Business Outlook Survey by CII.
KEY INDICATORS
India’s merchandise trade deficit reached $27B in September, down from the 10-month peak of $24B in August. Exports slowed by 2.6% to $34B, while imports decreased by 15% to $54B.
Consumer inflation fell to 5.0% in September, while wholesale inflation remained in the deflationary zone at -0.3%. Industrial production rose to a 14-month peak at 10.3% in August, indicating resilience in the economy amidst challenges like high inflation and global economic downturn.
Urban unemployment dropped to 6.6% in April-June 2023, down from 7.6% the previous year. This decrease follows the heightened joblessness in 2022, largely attributed to Covid-related restrictions.
Business activity saw a boost in the July-September period, reaching a three-quarter peak in confidence, as per a CII survey. The majority of participants reported a quicker rise in sales and orders, while over half anticipated capacity utilization to be between 75-100%.
Gross direct tax collections for FY 2023-24 surpassed $137B so far, up by 18% vs last year.
ICYMI
The Central Board of Direct Taxes (CBDT) assured that startups registered with DPIIT will not undergo scrutiny concerning the valuation of angel tax. This ensures DPIIT-registered startups are exempt from tax verification related to angel taxation, benefiting over 99K recognized startups.
Adani Ports to invest $2.5B in the Vizhinjam Transhipment Terminal in Kerala by 2030.
Indian Oil to invest over $200M in a joint venture with NTPC, for establishing renewable power plants.
Maruti Suzuki to invest over $15B in capex to expand its product lineup from 17 to 28 models, until 2030-31.
WEEKLY MARKET UPDATE (w/c October 9, 2023)
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