Mumbai: India’s largest infrastructure-focused private equity firm, IDFC Private Equity Co., plans to more than triple its assets for investments in roads, ports and power in the world’s second fastest growing major economy. IDFC will secure $700 million (Rs2,982 crore) from overseas investors for a third fund soon, Luis Miranda, chief executive officer, said.
He expects to raise another fund over the next three months for a?combined $2 billion in assets. 3i Group Plc., Deutsche Bank AG and Morgan Stanley are increasing alternative investments in India, where private equity firms raised seven times more than for China in the first quarter.
Miranda estimates between $15 billion and $20 billion is being raised as the government woos funds to build the airports and power stations needed to sustain economic growth.
IDFC has made investments through two private equity funds, the India Development Fund and the IDFC Private Equity Fund II, that collectively manage $630 million.
Miranda and his team have screened 900 proposals since starting IDFC’s private equity arm in 2002, he said. The group has invested in just 25, he said. “Infrastructure investing for us in India is in areas where we see a bottleneck,” said Miranda. “That could be education, health care or power, ports, roads and airports.”
Holdings include Quipo Infrastructure Equipment Ltd, India’s largest equipment rental company, and the Delhi International Airport Ltd, which is renovating the terminal in the nation’s capital. IDFC exited its investment in GMR Infrastructure Ltd when the operator of airports in New Delhi and Hyderabad sold shares to the public.
3i Group, Europe’s biggest publicly traded private equity firm, raised $1.2 billion last month for India, where infrastructure projects are estimated by the government to reach $450 billion by 2012.
Morgan Stanley, the second biggest US securities firm, said in April it plans to set up a private equity unit in India, while Deutsche Bank’s RREEF unit, the world’s largest alternative investment manager, plans to invest more than $1 billion over three years in real estate and infrastructure.