Indian GPs emphasize value-add - AVCJ Forum

"The acceptance is also much higher," said Archana Hingorani, CEO of IL&FS Investment Managers."Ten years ago if you tried to contribute, the promoter would not listen but it's much easier today".

While GPs are spending more time working with portfolio companies, there also needs to be a greater focus on certain sectors, since India is a diversified market and a firm cannot have a partner for every sector.

Unlike the boom years when there were 15-20 GPs bidding for every asset, there are now about 6-8 other bidders with capital, according to Gulpreet Kohli, managing director at ChrysCapital Partners."You can do 2-4 deals at reasonable pricing if you're patient," he said.

In terms of preferred strategies, PIPE deals have yielded good results and more GPs are likely to include them in fund strategy. "Our view is that firms will ask for more flexibility when they are fundraising," Kohli added. "India is pro-cyclical and Indian entrepreneurs raise money at the peak of the market."

Bain Capital Managing Director Pavninder Singh agreed with this view, adding that being dependent on investing capital when entrepreneurs want to raise it significantly narrows the set of opportunities.

And given the challenging macroeconomic environment, the plain vanilla growth capital transactions that have dominated Indian private equity are expected to tail off somewhat. "I think there will be more innovative deal-making and differentiated deal flow and strategy," said Padmanabh Sinha, managing partner at Tata Opportunities Fund.

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• Topics
• South Asia
• Investments
• Expansion
• GPs
• India
• Operating partners
• GPs
• Tata Capital
• ChrysCapital Management
• IL&FS Investment Managers
• Bain Capital Asia