Established Indian GPs shine in fundraising

Indian GPs, who have had a rather disappointing showing in the fundraising league tables in the last 2-3 years, are as ambitious as any in the region, though there will be clear competition for capital in 2012. Early signs suggest that firms and managers with strong track records will meet their targets, while less experienced rivals struggle.

Successes so far include the recently re-launched Westbridge Capital, which managed to raise $500 billion for its Westbridge Crossover fund in just six months. ChrysCapital also appears to be receiving the stamp of approval from LPs despite its founder, Ashish Dhawan, transitioning out of the group. The firm has reportedly reached a $225 million for first close en route to a $500 million target.

Other notable funds raised were Everstone, which garnered $580 million for its second vehicle, and Renuka Ramnath's first independent fund with just over $400 million.

Overall, India funds accounted for only 6.4% of total Asian private equity fundraising in 2011 to date. That is a significant drop from the salad days of 2006-2008 when India attracted capital commitments of $23 billion - about 14% of the regional total.

What will help in the future is evidence that GPs can exit their investments. In 2010, $3.9 billion of trade sales were recorded while private equity-backed companies raised $2.3 billion via IPOs. The trend continues this year with $2.2 billion of trade sales, although the volatile public markets have slowed listings to $540 million.

The industry is optimistic that it can return money to LPs. Indian GPs are keeping themselves busy with more than $6.4 billion invested year-to-date. While trailing the $8.7 billion recorded in 2010, India's share of the regional market is close to 15%, the highest level seen since 2007 and 2008.

As with other emerging markets, a large portion of the deals (and returns) concern significant minority stakes in growth companies. This is reflected in the transactions nominated for Deal of the Year in the 2011 AVCJ Indian Awards: Only one of the five nominees - Apax Partners and iGate's investment in Patni Computer Systems - represents a formal control deal.

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Save this article  
• Send to  

• Topics
• South Asia
• Fundraising
• India
• Fundraising
• WestBridge Capital Partners
• ChrysCapital Management
• Everstone Capital
• Multiples Alternative Asset Management