Skip to main content

"Patient investors can win big in India"

"India is an acquired taste. India is about long-term perspectives. India is about patience. But India is a place where you can make a lot of money". So says Rajiv Lall, newly appointed CEO of Infrastructure Development Finance Co. (and formerly with private-equity firm Warburg Pincus in New York) in a Reuters article comparing India (of the "potholed roads and decrepit airports") and China (of the "first-world superhighways and magnetic levitation rail lines").

More extracts from this interesting article:
JM Morgan Stanley estimates that China spent $325 billion on infrastructure in 2003, while India spent just $35 billion. Only in a few nations does the private sector play a big role in infrastructure development, JM Morgan Stanley economist Chetan Ahya says. He urges the government to spend an extra $20-$25 billion a year at least, to be financed by privatisation.

The China comparison makes Indian officials grumpy. They say India can be proud of its recent growth of 6-7 per cent a year given that its gross investment is only about 26 per cent of GDP. China, by contrast, invested some 44 per cent of GDP last year for 9.5 per cent growth. What's more, they add, many of China's infrastructure loans will turn sour, burdening its banks.

"We're going about improving infrastructure with a fairly conservative fiscal model. We're not breaking any banking rules. We're not suggesting anyone take undue risks," said Pradeep Deb, joint secretary at the Finance Ministry in New Delhi. "I think we are looking at a more sustainable long-term model of development by letting the institutions and the markets grow in a natural way," he said.

Tony Nash (former head of VC Research at Red Herring and The Industry Standard) and Paul Waide (Editor of Shanghai, China-based research firm Pacific Epoch) and I are having a discussion on foreign investments in India vis-a-vis China at the Pacific Epoch blog here. Feel free to weigh in with your takes.

Arun Natarajan is the Editor of TSJ Media, which tracks venture capital activity in India and Indian-founded companies worldwide. View sample issues of TSJ Media's Venture Intelligence India newsletters and reports.

Popular posts from this blog

VC Interview: Shailendra Singh of Sequoia Capital India

In a recent interview to Venture Intelligence, Shailendra Singh discussed some of the firm’s newer investments in the early stage segment including in the online payments space, the progress at a few existing portfolio companies and the active role the firm is playing in helping its portfolio companies scale and succeed in India and globally. Prior to joining the firm in 2006, Singh was a strategy consultant at Bain & Company in New York and before that, an entrepreneur in the digital media industry.

Venture Intelligence: How does Sequoia go about identifying potential early stage investments in India? Is there anything different you are doing today than, say, a couple of years back?

Shailendra Singh: There is a lot more focus on technology investing and early stage investing. In general, as you might remember a few years ago, we were doing primarily growth investing but in the past 18-odd months, we have had a very strong focus on early stage and that’s continuing. In terms of how…

PE investments in 2018 crosses $33-B to set new all-time high

Big Ticket investments in consumer apps Swiggy & Byju’s dominates year-end activity, even as investments in Core Sectors slow down
Private Equity (PE) investments in India rose to their highest ever figure of $33.1 billion in 2018 (across 720 transactions), according to data from Venture Intelligence (http://www.ventureintelligence.com), a research service focused on private company financials, transactions and their valuations. While PE investments have already surpassed the previous high - $24.3 Billion across 734 deals in 2017 - in the first nine months of 2018, the mega investments in Consumer Internet & Mobile startups such as Swiggy and Byjus towards the year-end, helped the 2018 total vault by 36% year-on-year. (Note: These figures include Venture Capital investments, but exclude PE investments in Real Estate.) The year witnessed 81 PE investments worth $100 million or more (accounting for 77% of the total investment value during the period), compared to 47 such transac…

ChrysCapital and Sequoia Capital India grab two awards at APEX’19 PE-VC Awards

Mumbai, India, Feb 27, 2019: ChrysCapital and Sequoia Capital bagged two awards each as part of the “Awards for Private Equity Excellence” (APEX)event organized by Venture Intelligence. 

ChrysCapital bagged the Private Equity Fund Raise of 2018 Award (Closed $850 M Fund VIII within 4 months of launch) and the Private Equity Investor of 2018 Award (for its Exits from LiquidHub with 4x in dollar terms (within 4 years of its $53-M investment), AU Small Finance Bank with 11.5x return,  Torrent Pharma with 2.95x, City Union Bank with 2.83x, L&T Infotech with 2.56x)

Sequoia Capital India won the Early Stage VCInvestor(the firm registered 10x+ exits in Byjus Classes and SCIOInspire) and VC Fund Raise of 2018 (the firm closed an almost $700-M Fund VI).


Award Winners at APEX'19 PE-VC Awards

The event opened with a Fireside Chat with Kiran Reddy, CEO of SPI Group interviewed by his long time friend and colleague Vineeth Vijayraghavan.



Snapshots of the Awards Ceremony: (L-R) Gopal Srinivasan, …