The Venture Intelligence Blog

Knowekdge@Wharton has published the proceeds of a a roundtable discussion between four leading limited partners - Kristin Gilbertson of the University of Pennsylvania, Sandra Pajarola of Partners Group, Cory Pulfrey of Morgan Stanley Alternative Investment Partners and Michael Taylor of HarbourVest Partners. Arun Natarajan is the Founder of Venture Intelligence India, which tracks venture capital activity in India and Indian-founded companies worldwide. View sample issues of Venture Intelligence India newsletters and reports.

Knowledge@Wharton has an article based on a panel discussion on private equity investing in India and China titled "Driving Returns: Value Added Investing." Mukund Krishnaswami, managing director of Krilacon Group, an investment firm based in New York and Philadelphia, agrees with Siegel about the current investment climate in India. "Long term, I'm a very big bull on India. India is a country where they've done so much wrong in the last 45 years. Yet despite all that there's so much that is good going on that if they just get it right, the opportunities [will be] fabulous in 25 years," he said. "In the short-term, I'm quite a bear. I think the risk premium just isn't there in most assets to be spending a lot of money [in India] today." Krishnaswami advised investors to follow the broader economy, not the trends that are hot today, including information technology or real estate. "Look for derivative areas of economic growth and t...

Knowledge@Wharton has published the second part of its interview with Wipro's Azim Premji. Aron: You already have a strong footprint in IT design, development, maintenance and operations. Now, as you said, you are trying to deepen your skills at the top -- in the consulting area -- so that you can be proactive in serving your customers and not just reactive. But the kind of person who goes into consulting -- say, my students at Wharton who might join a consulting firm after graduation -- is very different in profile, personal style, culture and expectations than someone who might join a technology firm. Do you see a contradiction here? Can you manage a panther and an elephant from the same menagerie? Premji: Of course this is a challenge, and we have to rise to it. We did this very well in AMS. We did it less well in NerveWire, where we had a higher attrition level. We are learning from this. One good thing we have been able to do in Wipro based on our experience over the years is...

Anand Sridharan of Bessemer Venture Partners has a blog post on why his firm (along with New Vernon Private Equity)has invested into Motilal Oswal Financial Services, a leading Indian stockbroking firm. Our thesis is that rising consumer incomes will translate into disproportionately higher allocation of these funds into equities. Right now, under 3% of India's retail assets are invested in stock markets. Cash, bank deposits, real estate and gold dominate the pie-chart on how Indians invest their wealth. As economies develop, this % rises to as high as 30-35% in the US. Further, the stock broking industry is highly fragmented and seeing a gradual consolidation. Motilal Oswal's growth has outpaced that of the industry and the company should continue to gain from this consolidation. Sridharan also promises BVP will be a patient - andf truly long-term - investor in the company: The main concern with the brokerage business is cyclicality. Trading volumes drop sharply during a down...

Business Today has a detailed article examining whether the boom in Indian real estate prices is sustainable. Points on the "Yes" side: To answer in a word, demand. Underlying it, though, are some key macro-economic reasons. One, the country's growth...To add to it, interest rates have actually come down from high teens to about 9 per cent, giving rise to an EMI (equated monthly instalment) economy, where even a Rs 30-lakh apartment is affordable to a large number of households..."Low interest rates and retail loan boom have turned the latent demand in many of these cities into a real demand," says Gaurav Dalmia, Chairman of Landmark Holdings and also a director on the board of a real estate fund, Fire Capital India. And then there are the usual Planning Commission, PwC and other consultacy numbers: "Currently, there is a need for 22 million dwelling units in India, and till this gap is bridged, there is no reason for the demand (for residential units) to ...

Business Today has an article profiling the Hyderabad-based GMR and GVK business groups (both named after their founders Grandhi Mallikarjuna Rao and Gunapati Venkata Krishna Reddy respectively) which have recently shot into the limelight for their winning bids to modernize the Delhi and Mumbai airports. Arun Natarajan is the Founder of Venture Intelligence India, which tracks venture capital activity in India and Indian-founded companies worldwide. View sample issues of Venture Intelligence India newsletters and reports.

Pvt equity giants jostle for slice of India pie Economic Times - Apr 19, 2006 “Clearly, the growth investments will make up the volume, but buyout deals will continue to tilt the numbers. But the market will segregate, with each player finding its sweet spot in the future,” says Arun Natarajan, editor, Venture Intelligence. Buyout deal by KKR is India's largest ever International Herald Tribune - Apr 17, 2006 According to Venture Intelligence India, private equity and venture capital firms invested $2.2 billion in India in 2005, spread across 146 deals. That sum was up 33 percent from the $1.65 billion in investment the year before. ...Now, analysts say, the Flextronics deal, nearing the $1 billion mark, will lend new credence to the trend. In a single deal, KKR will have invested nearly as much in India as the two current major players in private equity here, Warburg and Temasek, have invested over a period of several years. "When these guys came to town, people were skepti...