Tabreed, IFC to invest $400 mn for cooling infra in India, Southeast Asia

Source: Business Standard, Mar 03, 2021

Mumbai: UAE’s National Central Cooling Company or Tabreed, and International Finance Corporation (IFC) on Wednesday announced plans to invest USD 400 in India and South-East Asian countries to build cooling service infrastructure.

Tabreed and IFC, a member of the World Bank Group, have formed a joint venture to establish a district energy investment platform in Singapore, as per an official statement.

The JV will invest in district cooling, trigeneration and cooling as a service offering with a primary focus on India followed by other South-East Asian countries, it said.

“Platform to target USD 400 million in capital deployment in India and other South-East Asian countries,” the statement said, without specifying the exact allocation to the countries.

Tabreed has ongoing development activities in India and the platform will build on the same after the establishment of its wholly-owned subsidiary to install energy-efficient end to end cooling as a service offering through an outsourced utility model for real estate developments, new urban masterplans and ongoing redevelopments across target cities.

The government India Cooling Action Plan’ forecasts an eight-fold increase in demand through to 2038 and the commercial real estate sector alone estimated to add 100 million refrigeration tons in capacity during this period, it said.

The cooling as a service market is at a relatively embryonic stage in India and real estate developers make their own individual and varied cooling technology choices, funding Capex from their balance sheets to thereafter work with a fragmented ecosystem of service providers leaving significant headroom, the statement said. “The size and dynamism of India and other South-East Asian countries will keep them at the heart of the global energy system with all roads to a successful global clean energy transition going via India,” Tabreed’s chief executive Bader Saeed Al Lamki said.

PE/VC sector saw investments worth $47.6 billion in 2020

Source: The Hindu Business Line, Jan 28, 2021

Mumbai: The private equity and venture capital (PE/VC) sector recorded investments worth $47.6 billion across 921 deals in 2020, almost at par with the previous year, led by fund-raising by Reliance Group entities. Exits stood at $6 billion across 151 deals with open market exits accounting for 40 per cent of all deals by value.

Had it not been for the PE investments of $17.3 billion in Reliance Group firms, the year under review would have been 36 per cent lower than 2019. In terms of volume, number of deals in 2020 declined by 11 per cent compared to last year (921 deals in 2020 Vs 1,030 deals in 2019), according to a report by Indian Private Equity & Venture Capital Association and EY.

“PE/VC investment activity capped off a tumultuous 2020 on a high, closing out with over $7.1 billion of investments in December, making it the second-highest monthly total in 2020. While the Jio Platforms’ and Reliance Retail’s fund-raising juggernaut rolled on in May-June and September-November respectively, seemingly unaffected by the pandemic, Indian PE-VC investment activity ground to monthly average of less than $1.2 billion during March-June, the lowest ever in the past six years,” Vivek Soni, Partner and National Leader Private Equity Services at EY, said.

“July saw almost $4.1 billion of PE/VC investments (non-RIL entities) and as India continued to fare better than expected on both health and economic parameters, monthly PE/VC investment activity strengthened month-on-month,” he added.

Large deals (greater than $100 million) fell from 109 in 2019 to 66 (excluding RIL Group deals) largely due to the tepid deal-making for one-third of the year.

Infra sector hit

Consequently, while most sectors, barring the ones mentioned above witnessed declines in PE/VC investments, infrastructure sector investments declined the most, from $13.8 billion in 2019 to $5 billion in 2020. PE/VC exits too saw a significant decline of 46 per cent from 2019 levels, reaching a five-year low as pandemic induced lockdowns and the resulting disruptions roiled asset prices, forcing PE/VC investors to postpone stake sales to better times.

One of the biggest reasons for the relative decline in PE/VC investments in 2020 is the under-performance of the infrastructure and real estate sectors, which attracted the highest PE/VC investment in 2019, at $20 billion, accounting for 42 per cent of all PE/VC investments in 2019. In 2020, these sectors have received only $10.2 billion in investments, accounting for just 21 per cent of total PE/VC investments.

As a result, there has been a sharp decline in buyout activity as well, which has recorded a decline of 28 per cent in terms of value and 30 per cent in terms of volume. Infrastructure and real estate sectors accounted for 71 per cent of all buyouts by value in 2019 which has dropped to 61 per cent in 2020.

Exits

In 2020, exits fell by 46 per cent in value terms ($6 billion vs $11.1 billion in 2019) and is the lowest value in six years. In terms of volume, exits declined by 4 per cent compared to 2019 (151 deals in 2020 vs 157 deals in 2019). The decline was mainly due to fewer large deals. Exits via open market were the highest at $2.4 billion (67 deals) in 2020, 47 per cent fell compared to 2019. Exits via initial public offerings (IPOs) were second in line with $1.2 billion recorded across nine IPOs ($247 million across eight IPOs in 2019), which includes the $1 billion SBI Cards partial exit by Carlyle.

Japan’s Kirin to invest $30 million in maker of Indian craft beer Bira

Source: Business Standard, Jan 04, 2021

NEW DELHI/TOKYO (Reuters) – Japan’s beer maker Kirin Holdings will invest $30 million in New Delhi-based B9 Beverages, the companies said on Monday, as it seeks to secure a spot in India’s growing craft beer market amid falling sales at home.

The Japanese brewer will acquire a stake of under 10% in B9, the maker of India’s popular craft beer Bira, a Kirin spokesman and Bira CEO Ankur Jain told Reuters. They declined to give further financial details.

B9 had been in talks with international brewers – including Kirin – and other investors to sell a stake of up to 20% in the company, Reuters reported in August.

The investment would allow Bira, which has posted losses in recent years and has been hit by the COVID-19 pandemic, to break even in the 2022 fiscal year which starts in April 2021, Jain said.

“The companies will be exploring business synergies,” Jain said, adding that the investment would allow Bira to accelerate plans to launch its products in Japan later this year.

He expected the deal to be closed over “the next few days”.

While Bira, launched in 2015, is one of the smallest players in India’s broader beer industry, its craft beer offerings have become increasingly popular in recent years. Bira says it has a 5-10% share of the beer market in cities such as New Delhi, Mumbai and Bengaluru.

Kirin meanwhile has historically shown interest in independent breweries and owns a minority stake in New York’s Brooklyn Brewery.

But its M&A record overseas has been patchy, with the Japanese firm selling its unprofitable Brazilian unit in 2017 to Heineken after losing market share.

Its entry into Myanmar in 2015 has also come under scrutiny amid a probe into its local partner’s connections to the military. Data provider PitchBook estimates Bira was valued at $210 million in 2018. U.S.-based Sequoia Capital holds a roughly 45% stake in the company, while CEO Jain and his family own around 30%.

FDI in non-life insurance sector slips marginally to Rs 509 cr in FY20

Source: Financial Express, Dec 01, 2020

Foreign direct investment (FDI) in the general insurance sector slipped marginally to Rs 509.07 crore in FY 2019-20 from the previous year, latest data by the General Insurance Council (GIC) showed.

In FY2018-19, FDI in the non-life insurance space was recorded at Rs 516.61 crore.

Since the opening up of the insurance market in 2000, the non-life sector attracted a total FDI of Rs 4,721.68 crore as on March 2020. It was Rs 4,212.61 crore at the end of March 2019.

There are 33 general insurance players, including four public sector insurers, six standalone health insurers and two state-owned specialised companies — Export Credit Guarantee Corporation of India and Agriculture Insurance Company of India Limited (AIC). Read the rest of this entry »

Best time to invest in pharma, medical device sector: Sadananda Gowda

Source: Business Standard, Oct 01, 2020

New Delhi: This is the most opportune time to invest in theIndian pharma and medical device sector as the government is extending production linked incentives for new manufacturing units in the upcoming bulk drug and medical devices parks,Union Minister DV Sadananda Gowda has said.

The Indian pharma sector, currently valued at USD40 billion, has the potential to become a global pharmacy hub in the coming years, the Chemicals and Fertilisers Minister said in a statement.

The sector is likely to grow to USD 65 billion by 2024, and to USD 120 billion by 2030, he added.

The medical devices industry in India has the potential to grow at 28 per cent per annum to reach USD 50 billion by 2025,Gowda said.

The Indian pharma and medical device sector has immense potential to contribute towards making India a 5 trillion-dollar economy in the next 4-5 years, he added.

The government is supporting development of 3 bulk drug and 4 medical device parks with state-of-art infrastructure and world-class centres of excellence across the country, Gowda said.

“Government will also provide production linked incentives to eligible new manufacturing units to ensure a level playing field to domestic manufacturers,” he added.

It is expected that the schemes of the government for development of bulk drug and medical device parks will attract cumulative investment of Rs 78,000 crore and can generate about 2.5 lakh employment,he added.

“There is a need for the pharma industry to focus on R & D activities in order to remain as one of the leading global suppliers of medicines,” Gowda said.

The full potential of growth cannot be tapped unless the sector comes up with discovery of new drugs or repurposing in India,he added. Gowda also expressed hope that the Indian pharma sector will be among the first ones to develop and supply low cost vaccines for COVID-19.

India received $20 billion in FDI during COVID-19 pandemic: Harsh Shringla

Source: The Economic Times, Sept 15, 2020

India has received over USD 20 billion in FDI amid the coronavirus pandemicForeign Secretary Harsh Vardhan Shringla said on Tuesday, showcasing the country as one of the most attractive destinations for investment globally. In a virtual address at a CII event in the UK, the foreign secretary highlighted various structural reforms undertaken by India in even previously restricted sectors such as space, defence and atomic energy for greater private participation.

“The government of Prime Minister Narendra Modi has launched several historic reforms to improve the ease of doing business in India in the last six years. Today, India is one of the most open economies in the world. We have put in place a transparent and predictable tax regime,” he said.

Shringla talked extensively about implementation of various ambitious initiatives like, rolling out of Goods and Services Tax, the Aadhaar biometric project, “groundbreaking reforms” in the agriculture sector and creation of infrastructure for railways, ports and airports.

“The success of the reforms launched by the Government is evident in the numbers. Even during the pandemic, we have received over USD 20 billion of FDI this year. While the global FDI declined by one per cent in 2019, FDI into India rose by 20 per cent in the same period,” he said.

The foreign secretary said several global technology majors have announced significant investments in India including USD 10 billion by Google, USD 5 billion by Facebook and USD 1.2 billion by Mubadala – the UAE Sovereign Wealth Fund. Talking about India-UK economic partnership, he said the bilateral trade has been on an upward trajectory and touched 24 billion pounds in 2019 and that the country is the sixth largest investor in India with investments totalling USD 28.21 billion.

“The COVID-19 pandemic has created severe economic challenges for both our countries. We can overcome these challenges by working together to create new opportunities for our business and industry,” said Shringla. He said under the ‘Aatmanirbhar Bharat Abhiyaan’ or self reliant India campaign, India has rolled out a stimulus package for the economy of about USD 270 billion. The foreign secretary said research and development for vaccines for COVID-19 is a crucial area where there is potential for collaboration between India and the UK.
Serum Institute of India is already working with the Oxford University-Astrazeneca on their vaccine project. I talked about the role played by India’s pharmaceutical sector in meeting the global demand for essential medicines during the pandemic,” he said. “We are certain that our companies will play a similar role in the development of an affordable vaccine for COVID-19,” he added.

India eyes investment from Japanese firms

Source: The Economic Times, Sept 13, 2020

New Delhi: India has reached out to Japanese companies, not yet present in the country, such as NintendoHitachi MetalsTaisho PharmaOno Pharma and Mizuno to set up operations here, and urged conglomerates already here to bring verticals currently missing.

The Japanese government is offering its companies incentives to shift manufacturing bases out of China either back home or to India or Bangladesh.

New Delhi is keen to wean some of them here and is reaching out to them to facilitate their entry, officials said. “We are in touch with Japanese investors,” a senior government official told ET. “Engagement with them is going on at various levels.”

The government has drawn up a list of all the Japanese companies and is reaching out to them. Three categories of companies have been identified as part of the exercise.

The first category consists of companies not present in India. The second list is of companies that have just one business vertical in the country while other verticals are in China. The third is of those companies that have manufacturing here but can expand capacity further.

Those in the first list include auto companies Mazda and Subaru, sports retail and ecommerce company Mizuno, textiles companies Descente and Unitika, and railcars maker Japan Transport Engineering Company.
Japan has allocated about $221 million subsidy to encourage companies to relocate their manufacturing from China for 2020. Japanese supply chains are currently heavily dependent on China.

India has formed a high-level group chaired by cabinet secretary to draw up a phased manufacturing plan and incentive schemes to attract foreign investments in manufacturing of mobile and electronics, medical devices, and pharmaceutical drugs.

The group, comprising secretaries of key ministries and departments including the Department for Promotion of Industry and Internal Trade (DPIIT), has also been mandated to identify potential investors and organisations across key sectors and geographies with the capacity to invest in India or enter into joint ventures with Indian companies.

A national repository of landbank has been set up to provide ready access to availability of land and resources in the country.

Japan is the fourth biggest investor in India. Its total cumulative equity foreign direct investment (FDI) into India is nearly $200 billion, 7% of the total flows and more than that from the US and UK.

Finance Minister Nirmala Sitharaman welcomes US companies investment in India

Source: The Economic Times, Sept 04, 2020

Finance Minister Nirmala Sitharaman welcomed US companies investment and partnership with India, especially in the manufacturing and infrastructure sectors, during a virtual discussion with US-India Strategic Partnership Forum’s (USISPF) Board of Directors on the sidelines of its 3rd Annual Leadership Summit. 

According to a statement issued by USISPF, the finance minister’s discussion with the Board members focused on ease of doing business in India; digitization & fintech; agriculture (including agricultural infrastructure) and private sector participation across all the sectors of the Indian economy. 

Skill development; healthcare; CoVID-19 mitigating measures undertaken by the government & possible future course of actions; role of government spending in the infrastructure sector in the coming years; and manufacturing in India (with a special emphasis on the logistics sector in India), we’re also discussed. 

India continues to be a leading investment destination for US companies, having attracted investments over $20 billion in 2020. 

The United States and India are key strategic partners in various fields including in the economic and financial sphere. The US-India economic and financial partnership is based on the key pillars of development for both the countries that includes robust capital flows, and economic cooperation on issues of global importance, the statement added. 

Attendees at the meeting included: USISPF Chairman John Chambers; Ajay Banga, CEO, Mastercard; Charles Kaye, CEO, Warburg Pincus; Anish Shah, Deputy Managing Director & Group CFO, Mahindra; Shantanu Narayen, Chairman, President & CEO, Adobe; Robert Moritz, Chairman, PwC; Punit Renjen, CEO, Deloitte Global; Jim Umplebey, Chairman & CEO, Caterpillar among other fortune 500 leaders. 
USISPF President & CEO, Dr. Mukesh Aghi said, “We believe investments from U.S. companies will create new jobs, facilitate financial inclusion, and broad-based economic development for the Indian economy. It is encouraging to hear the Honorable Finance Minister’s commitment to provide a red-carpet welcome for long-term US investments in the Indian market.” 

RBI revises norms for core investment cos

Source: LiveMint.com, Aug 14, 2020

MUMBAI: The Reserve Bank of India (RBI) on Thursday announced stricter guidelines for core investment companies (CICs), mandating more disclosures, better risk management and a simpler group structure.

The new guidelines were based on the recommendations of the Working Group to Review Regulatory and Supervisory Framework for CICs, headed by Tapan Ray, former secretary of the corporate affairs ministry. The report was published by RBI on 6 November 2019.

CICs are non-bank lenders holding not less than 90% of their net assets as investments in equity shares, preference shares, bonds, debentures, debt or loans in group companies. Experts have been seeking a review of CIC guidelines ever since defaults by Infrastructure Leasing and Financial Services Ltd, a large systemically important CIC.

RBI said the parent CIC in the group, or the CIC with the largest asset size, will have to form a group risk management committee (GRMC), which will report to the board of the CIC that constitutes it and must meet at least once in a quarter. It will comprise at least five members, with two independent directors.

According to the revised guidelines, the GRMC will have to analyze material risks to which the group, its businesses and subsidiaries are exposed. “It must discuss all risk strategies, both at the aggregated level and by type of risk, and make recommendations to the board in accordance with the group’s overall risk appetite,” RBI said.

Moreover, all CICs with assets of over ₹5,000 crore will have to appoint a chief risk officer with clearly specified roles and responsibilities.

To address the complexity in group structures, the central bank also decided to limit the number of layers of CICs within a group, including the parent, to two. If a CIC makes any direct or indirect equity investment in another CIC, it will be deemed as a layer for the investing company, it added.

While the regulation will be applicable from the date of the circular, existing entities have been given time till 31 March 2023 to reorganize their business structure.

RBI also directed CICs to maintain a functional website containing basic information about the entity and the group. The website should also have annual reports, corporate governance report, management discussion and analysis. Core investment firms are mandated to prepare a consolidated financial statement as per the provisions of the Companies Act, 2013, to provide a clear view of the financials of the group as a whole.

BP to invest USD 70 million in India’s Green Growth Equity Fund

Source: LiveMint.com, Jul 07, 2020

INDIA: The UK-based BP plc on Tuesday said it will invest USD 70 million in the Green Growth Equity Fund (GGEF) that supports the growing renewable energy sector in India.

The fund, established in 2018, is focused on identifying, investing and supporting growth in zero-carbon and low-carbon energy solutions in the country.

“With a commitment of USD 70 million, BP will, upon investment later this year, become a limited partner in GGEF and have representation on its advisory committee, as well as the rights to co-invest in projects alongside GGEF,” the company said in a statement.

GGEF already includes investments from the Government of India, through the National Investment and Infrastructure Fund (NIIF), and the UK government, through the Department for International Development (DFID).

It expects to reach about USD 700 million commitment at the final close and grow further through leveraged capital options.

Dev Sanyal, BP Group’s executive vice-president for gas and low-carbon energy, said: “India is committed to the energy transition and pursuing a range of low-carbon options for the future. BP is equally committed to re-imagining energy in India.”

He said BP’s investment in GGEF was aligned with the group’s strategy of investing in integrated low-carbon energy using innovative partnerships and business models.

“It provides a unique platform for BP to accelerate its ambition in India and to co-invest in a variety of zero- and low-carbon energy solutions in the country,” he said.

Earlier this year, BP announced its ambition to become a net-zero company by 2050 or sooner. As part of this, one of its 10 aims is to increase the proportion of investments into non-oil and gas businesses.

Sashi Mukundan, president of BP India and and senior vice-president of BP Group, said, “Our investment in GGEF will aim to rapidly scale up commercially viable low-carbon solutions.”

“The portfolio and scale of investments made by GGEF — be it in solar power, mobility solutions, or sustainable infrastructure management — is extraordinary. Each one of these will help India achieve its climate goals,” he said.

GGEF is managed by EverSource Capital, a joint venture between Lightsource BP and Everstone Capital, and has invested in businesses like Ayana Renewable Power, Radiance Renewables, GreenCell Mobility, and EverEnviro.

Dhanpal Jhaveri, chief executive officer of EverSource Capital and vice-chairman of Everstone Group, said, “Eversource is committed to investing in India’s rapidly scaling green sector and providing renewable energy solutions in the country.”

EverSource has a long-term objective of becoming a leader in green infrastructure and climate change investing in India.

BP employs around 7,500 people in India. In addition to its gas value chain, announced retail, aviation fuels, and mobility solutions alliance with Reliance Industries Ltd, the company’s activities include Castrol lubricants; oil and gas trading; clean energy projects through Lightsource BP; IT back-office activities and a new global business services centre. India Gas Solutions Pvt Ltd, a 50:50 joint venture to source and market gas in India, is also part of BP’s gas value chain alliance with RIL.