US-based private equity firm Trikona Capitalhas said it plans to invest up to $4 billion (about Rs17,700 crore) in India in the next three to five years the for stakes in sectors such as infrastructure, real estate, hospitality and health.
in an a economy that has grown more than 8% for four straight quarters. In the nine months since it raised its first India fund of $500 million (about Rs2,200 crore), Trikona has invested around $250 million (about Rs1,100 crore) in as many as eight companies, leaving . This has left it with about $250 million in hand.
Trikona’s managing director, Aashish Kalra, said, “My firm is optimistic about the investment environment in India.”
Trikona is the India fund manager for Trinity Capital Plc, a private equity fund that is listed on London’s AIM, or the exchange for smaller companies. Trikona says it will raise $1 billion (about Rs4,400 crore) this year from hedge funds, insurance firms, mutual funds and other financial institutions in the US and the UK. It plans to invest $1 billion in India this year.
“India needs 100 new cities in the next decade,” Kalra says. “We see opportunities in the many Dwarkas or Thanes that can come up.” Thane is a Mumbai suburb, and Dwarka, a large colony in Delhi; both have seen frenetic development activity in recent years.
Last week, Trikona invested around $18 million to take a 49% stake in a residential and commercial property in the southern city of Hyderabad, two days after it invested $26 million in a ship-building project in the Western state of Gujarat.
On 15 January 2007, Trikona spent about $7 million to pick up 3.5% in New Delhi-based Fortis Healthcare Ltd, which runs a chain of hospitals in North India.
The company’s other investments include a software park located in the New Delhi suburb of Greater Noida, and residential projects and hotels in the Mumbai. area.
Private equity funds invested about $7.5 billion (about Rs33,150 crore) in 229 deals in India in 2006, compared with $2.4 billion in 2005, says Chennai-based Venture Intelligence, which tracks the country’s private equity market. The last quarter of 2006 alone witnessed investments worth $2.6 billion, according to the research firm.
Till about two years ago, the private-equity deal sizes in India ranged merely between $10 million and $30 million. But 2006 saw the emergence of bigger investments.
In March 2006, Singapore government-owned Temasek Holdings picked almost 10% in Tata Group’s telecom arm for about $330 million. Six months later, US-based equity fund, Providence Equity Partners, bought 16% stake in Idea Cellular for about $400 million.