Sovereign funds flock to India with mega moneybags even as FIIs, PEs remain wary
MUMBAI : Mumbai: Some of the world’s largest sovereign wealth funds, including Singapore’s GIC Holdings Pte. Ltd, Abu Dhabi Investment Authority, and Kuwait Investment Authority, have significantly increased their investments in Indian stocks and startups the past few years. These three funds held a collective ₹5 trillion, or nearly $60 billion, in Indian stocks as of 31 March, show data compiled by Mint.
Of that, about ₹2.57 trillion (about $30 billion) was invested over the previous three financial years (2021-22 to 2023-24). Sovereign funds are doubling down on India at a time when global private equity firms, venture capital funds and other growth-stage investors are taking a measured approach to backing domestic companies. Their growing interest in Indian markets also comes amid a tapering of foreign institutional investment in the country, although analysts expect FII flows to rebound in the second half of this year.
Foreign institutional investors net sold ₹146.29 crore worth of Indian equities between 1 January and 2 July. The recent inclusion of Indian sovereign bonds in JPMorgan Chase & Co.’s global debt indexes is also expected to boost the country’s appeal to sovereign funds, say market experts. Earlier this week, ADIA, the largest sovereign wealth fund in the United Arab Emirates, invested as part of the anchor round in Emcure Pharmaceuticals Ltd’s initial public offering.
It is also looking to team up with private equity firm Blackstone to acquire a controlling stake in Haldiram Snacks Food Pvt. Ltd, as Mint reported earlier. ADIA also pumped in ₹1,400 crore in growth-stage beauty and personal care startup Purplle last week, and is set to invest ₹2,001 crore in four residential projects of real estate
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