Bloomberg Funds May Put $25 Billion a Year in India Infrastr

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Bloomberg
Funds May Put $25 Billion a Year in India Infrastructure, According to Ambit Capital
Baiju Kalesh
Fri, November 25, 2022, 2:07 AM

(Bloomberg) -- Global pension and sovereign wealth funds could invest around $25 billion a year in Indian infrastructure, according to investment bank Ambit Capital. Funds appreciate the better regulatory framework, growth in India and commitment to the climate change requirement for the net-zero carbon policy, Rahul Mody, managing director and co-head of investment banking at Ambit, said in a Bloomberg Television interview on Friday. “Domestic investors, institutional investors and high net worth individuals and family offices will continue to invest, but I would say a majority of these investments will come from global funds,” he added. Mody cited investment infrastructure trusts, known as InvITs, as a type of vehicle that has attracted global funds. Initiated by the government several years ago, InVITs offer tax incentives and concessions as well as a governance and capital structure that is robust, and restricts leverage, he said.

In terms of subsectors, roads and renewable energy have attracted the most capital, Mody said. Investors have also shown interest in telecommunication towers, digital infrastructure, data centers, fiber and power transmission, he said. Hydrogen, energy storage and railways could see significant investment, Mody added.

--With assistance from Haslinda Amin, Rishaad Salamat and Anand Menon.

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Live Long and Prosper....

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Reuters
Sovereign investors favour U.S., India as top 2022 investment markets - study
People walk on New York City ahead of U.N. report that world's population nears 8 billion
Sun, November 20, 2022, 7:07 PM
In this article:

IVZ
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LONDON (Reuters) - India has emerged as the second most coveted investment market after the United States for sovereign wealth funds and public pensions funds in 2022, according to a study by asset manager Invesco published on Monday. Sovereign investors, which now manage some $33 trillion in assets, have also seen a rapid rise in allocations to private markets, though this development might start to slow with fixed income back in favour, the Invesco Global Sovereign Asset Management Study said. "Over the last 10 years sovereign investors have invested with the wind at their backs thanks to the secular bull market that emerged from the global financial crisis," said Rod Ringrow, Invesco's head of official institutions. Average annual returns for sovereign investors over the past decade stood at 6.5% and, for sovereign wealth funds alone, at 10% in 2021, Invesco found. However, 2022 could prove to be a turning point with higher inflation and tighter monetary policy hitting long-term expected returns.

While the United States remained the top destination, some sovereign investors were keen to rebalance portfolios, fearing they had become overly reliant on U.S. markets which left them vulnerable to the correction in equity markets seen this year, Invesco said. Back in 2014, the UK was the most desirable destination.

Emerging markets were set to benefit from the latest shift, the study predicted. Among developing nations, India has overtaken China as the most popular emerging market, having climbed to No. 2 in 2022 from No. 9 in 2014. "While this is partly because funds with dedicated Asian allocations are trimming their China exposure, investors have commended India's positive economic reforms and strong demographic profile," the study found.

China currently ranks in sixth place.

The past decade had also seen a steady increase in the creation of sovereign wealth funds with a dozen established in Africa, of which 11 have a strategic mandate to develop local economies, Invesco found.

(Reporting by Karin Strohecker; Editing by Sandra Maler)

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Quartz
Foreign investors are taking a shine to India's financial services sector
Mimansa Verma
Wed, November 23, 2022, 3:25 AM

India’s financial services industry is soaking in foreign portfolio investor (FPI) funds. In the first 15 days of November, FPIs invested 11,452 crore rupees ($1.4 billion) in the sector. That’s nearly 40% of their net equity investments in India in this period, according to National Securities Depository which maintains the country’s capital market data.

India’s financial services sector comprises commercial banks, insurance companies, non-banking financial companies, co-operatives, pension funds, mutual funds, and other smaller financial entities. While commercial banks hold more than 64% of India’s total financial system assets, new entities like payment banks have also been added in recent years. The fast-moving consumer goods segment has been FPIs’ favorite, too. Up to Rs3,514 crore was pumped into it in the first two weeks of this month. Information technology, with Rs3,005 crore invested in, was another key area. “FPIs have turned buyers over the last 1-2 weeks despite record valuation premium relative to both MSCI emerging markets and developed markets, deteriorating global growth outlook, and strengthening dollar index,” HDFC Securities said in a report earlier this month.

A stellar performance by Indian banks

In the September quarter, the 12 public sector banks together declared a net profit of Rs25,685 crore, up 50% from a year ago. At Rs32,150 crore, the private sector’s net also saw a considerable rise year-on-yea at 64%. A fall in provisions and contingencies resulted in this. With bad loans declining progressively, banks now don’t need to set aside as much money as they used to in previous quarters. “September quarter earnings have been good, in fact, banks have done extraordinarily well. Credit growth is picking up for each and every bank, which means there will be investments. If the capex cycle starts, there will be growth in the future, so these are positive indicators,” Sharad Chandra Shukla, director of Mehta Equities, told Business Insider India. During the first fortnight of November, the Nifty bank index rose 2.6%.

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Live Long and Prosper....

[ECE Prof]

Make money anyway you can. Why not? In their billionaire club, there have been several more from India this year instead of China. Adani's wealth skyrocketed this year with his investments in infrastructure and expanding to energy this year. Bloomberg wants a piece of it. I do not blame him.