India’s private equity investors are optimistic about the country’s infrastructure growth story, especially when it comes to future investments in the social sector and renewable projects. According to Ami Momaya, Director of Infrastructure at KKR, India is a huge market with a vast infrastructure opportunity. “The sector is very attractive, which also brings a lot of competition. I think over time returns have compressed, but there is also a large enough supply of assets. What’s worked really well for us is to identify themes early and jump in when no one else was thinking of investments like toll roads during Covid or picking up decarbonisation as a strategy,” she added.
Momaya also highlighted that many funds are investing in under-construction projects like data centres, which is a good mix of assets for government privatisation and developers getting lucrative exits. CPP Investments believes that the next few years will see the biggest supply of assets for funds to invest in, which will mainly come from the government. “On the transmission side, a lot of it will come from the new program of transmission assets being built out by the government’s 500 GW plan. Similarly, on the airports side, there are a few brownfield airports which might trade, but the biggest supply will come from the new airports being brought out by the airports authority for monetization,” said Pushkar Kulkarni, Managing Director of Infrastructure and Sustainable Energies at CPP Investments.
Sreekumar Chatra, Managing Director of Infrastructure Fund at Edelweiss Alternative Asset Advisors, is also optimistic about the considerable deal flow across core infrastructure sectors, including roads transmission, renewables, ports, and airports. “We’re also seeing the emergence of allied sectors such as green investments, cleantech, data centres, and digital infrastructure. The nascent stage sector that we would like to see is the social sector,” he added.