Fund manager Trikona Capital Ltd is exploring various options to raise funds to invest $1 billion annually in India over the next ten years, a top official said.
“Trikona intends to raise the money through public and private equity from institutional investors. We are evaluating options. We will also pump money from sell downs back into the deal pipeline,” Managing Director Aashish Kalra told Reuters.
Trikona is an India-focussed fund management firm and manages the 250-million-pound Trikona Trinity Capital Plc fund listed on London's Alternative Investment Market.
The funds go into India's real estate and infrastructure sectors.
“With the growth of the middle-class, there is a huge opportunity in urbanising out there, because India needs new cities and infrastructure,” Aashish Kalra said in an interview.
One of the fund raising options is to sell its stake in its real estate investments and increase its investments in real-estate based infrastructure assets.
“Trinity is just one investment product out of several the group plans to launch,” Kalra added. Also on the cards is a listing in India though plans have not yet been firmed up.
Some of Trikona's Indian investments include Pipavav Shipyard, which is planning a listing, DB Realty, IL&FS Transportation & Networks Ltd and Phoenix Mills.
It has invested more than $1 billion in India in the last two years and in some of its investments have got returns of more than 100 percent.
The fund's investment portfolio in India is roughly equally split between real estate and infrastructure now, but infrastructure is expected to make up 70 percent over a period.
“We believe infrastructure is the bigger opportunity.” It also has the added attraction of yielding higher returns, creating shareholding value, he said.
The fund manager is looking at roads, energy, ports, special economic zones. “The opportunities are many, but one has to be focussed. One cannot invest everywhere.”
The fund's average returns are expected to be more than 25 percent, while it has an investment and payback horizon of 3-5 years under normal circumstances.
Trikona's major shareholders include Citigroup Global Markets, UK Equity Ltd, The Bank of New York Nominees Ltd, and Vidacos Nominees Ltd.
Source: Reuters