India In Sight #21
India In Sight #21
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
Equity
[Exit] Softbank sold c.1% stake in Zomato, a food delivery platform, for $125 million in a secondary market transaction. Softbank received a c.3% stake in Zomato after the share swap with Blinkit, a quick grocery-delivery platform now owned by Zomato. The remaining stake is valued at $128 million. (October 20, 2023)
Zetwerk, a B2B e-commerce platform, raised c.$120 million in series F financing round led by Avenir Growth Capital. at a $2.7 billion valuation. Other investors include Greenoaks Capital, Steadview Capital, D1 Capital, and Lightspeed. (October 18, 2023)
[Exit] Banyan Tree Growth Capital, a domestic venture capital fund, to sell its entire c.33% stake in GPT Healthcare, a multi-specialty hospital chain, as a part of its IPO, for an estimated c.$75 million (translating to >15x MOIC). (October 17, 2023)
TPG to acquire a 9% stake in Tata Technologies, a digital solutions company owned by Tata Motors, for c.$177 million. (October 16, 2023)
Credit
The Adani Group has refinanced its acquisition debt for Ambuja Cements and ACC with a $3.5 billion financing package from ten international banks, resulting in cost savings of $300 million. Major banks include DBS Bank, First Abu Dhabi, Barclays, BNP Paribas, Deutsche, Standard Chartered, among others. Loan likely priced at SOFR+500 bps. (October 20, 2023)
Other Deals and Issuances
Piramal Enterprises to raise $1.2 billion through issuance of NCDs at 9% coupon rate; Titan Group is raising c.$310 million through issuance of NCDs on a private placement basis.
KEY FUNDS AND FUNDRAISES
InCred, a domestic alternative investments fund manager, marked the final close of its maiden private credit fund at c.83 million (exceeding the $63 million target). The firm has already deployed 85% of its committed capital across sectors including B2B, consumer, healthcare, finance and cleantech. (October 20, 2023)
PropShare Capital, a domestic real estate focused fund, launched its second fund with a target corpus of $60 million. The fund will invest in Class A rent-generating commercial properties leased to multinational and blue-chip tenants in India’s tech hubs. (October 19, 2023)
Singularity Ventures, an asset management firm, marked the first close of its second fund at c.$63 million; The fund has a target corpus of c.$188 million and is dedicated to growth-stage startups. (October 19, 2023)
NIIF, India's sovereign-backed infrastructure fund, to sell its maiden portfolio of five road projects for c.$1.2 billion. These operating road assets are housed under Athaang Infrastructure, a company sponsored by NIIF’s Master Fund, and holds five assets with a total road length of 230+ kilometers spread across north and south India. (October 19, 2023)
Vivriti, a domestic debt-focused asset management firm, has collectively raised and closed c.$200 million for three of its debt funds (Wealth Optimizer, Emerging Corporate Bond, Alpha Debt). The firm has already deployed 75% of its fund value. (October 18, 2023)
Quadria Capital, a healthcare focused fund, marked the first close of its third fund at c.$500 million (60% of the $800 million target). (October 18, 2023)
MARKET INSIGHTS & RESEARCH
Articles
Liquid funds experienced significant outflows of c.$9.3B in Sep 2023, the highest among debt-oriented schemes, due to RBI’s measures to tighten banking liquidity. These outflows are partly attributed to cyclical trends during half-yearly closes and the tightened liquidity conditions in the banking system. Read more.
The finance ministry is actively exploring strategies to reduce the government's debt. India's public debt is a key constraint to its credit rating profile by global rating agencies as the total debt has been high even before the pandemic. Read more.
The National Infrastructure Pipeline is valued at c.$1.4T, surpassing the government's capex capacity. The bond market, historically dominated by government bonds, needs a revamp to bridge the gap between India's infrastructural requirements and investors seeking consistent returns. Read more.
RBI is not considering changes to regulations on banks' unsecured lending portfolios, as no widespread stress is evident. This comes despite a significant increase in unsecured loans, such as personal loans and credit cards, which have grown faster than the overall bank credit growth of approximately 15% in the past year. Read more.
The capital spending of 13 major Indian state governments is projected to rise by 29% to c.$77B in FY2024. Read more.
India has emerged as the 3rd largest ecosystem for startups globally, producing 100+ unicorns with a total valuation of $340B+. Avendus research provides insights in the startup and tech IPO ecosystem of India. Read more.
Indian solar manufacturers are exporting a significant portion of their products due to high imports of solar modules and cells, despite trade barriers. India's solar exports reached c.$500 million in April-June vs c.$30 million during the same period last year with the U.S. being the primary buyer, benefiting from restrictions on Chinese module imports. Read more.
Reports
SBI Research paper suggests that the credit to GDP ratio is projected to rise to 1.7 in FY24 vs 1.2 in FY22, indicating a sustained GDP growth phase. This growth is linked to increased manufacturing capacity utilization and robust credit demand. Banks are now performing well, with significant profit growth and reduced NPAs, underscoring a positive economic trend.
The Indian real estate sector saw $5.1B in capital flows in 9M 2023, down 6% yoy. CBRE report shares insights into the Indian real estate sector with focus on the offices, residential, retail, industry and logistics.
Inc42’s ‘India’s Generative AI Startup Landscape 2023’ report shares that the country’s GenAI market will be growing exponentially in the next few years and is projected to surpass $17B by 2030 from $1.1B in 2023, growing at a CAGR of c.50%. [Paywall]
KEY INDICATORS
Passenger vehicle sales rose by c.2% yoy to 360K units in September. 2W sales saw a slight increase, while 3W wholesales significantly rose by c.50% vs August.
As per the latest RBI monthly bulletin India's GDP grew by 7.8% in Q1FY24, driven by private consumption and investment. While urban consumption remains strong, rural demand is rebounding. Industrial production increased by 5.7% in July, and CPI inflation rose to 7.4% in July before dropping to 6.8% in August.
Person-to-merchant (P2M) transactions expected to constitute 75% of all the UPI transactions by 2025.
Below is a quick snapshot of the services sector performance from the RBI bulletin.
WEEKLY MARKET UPDATE (w/c October 16, 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.
This post and the information presented are intended for informational purposes only. The views expressed herein are the author’s alone and do not constitute an offer to sell, or a recommendation to purchase, or a solicitation of an offer to buy, any security, nor a recommendation for any investment product or service. While certain information contained herein has been obtained from sources believed to be reliable, neither the author nor any of his employers or their affiliates have independently verified this information, and its accuracy and completeness cannot be guaranteed. Accordingly, no representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, timeliness or completeness of this information. The author and affiliated persons and companies assume no liability for this information and no obligation to update the information or analysis contained herein in the future.