Make in India: India woos Chinese investors, promises conducive environment

by | posted in: Corporate Updates, Economy, Business Updates, Corporate Affairs, India & International - Corporate updates | 0
“We will facilitate your efforts to make your investments in India profitable. We must take advantage of the opportunities that abound in the growth of both our economies,” said President Pranab Mukherjee.

India today promised a conducive environment for Chinese investors and urged them to participate in ‘Make in India’ and other flagship programmes of the government to boost bilateral trade.

“We will facilitate your efforts to make your investments in India profitable. We must take advantage of the opportunities that abound in the growth of both our economies,” said President Pranab Mukherjee addressing a meeting of the India-China Business Forum here on the second day of his four-day visit to China.

The forum, attended by industrialists and businessmen of both sides, was told by the President that India would like to see greater market for Indian products in China in a bid to balance bilateral trade which is now in China’s favour.

This, he said, would particularly be needed in sectors where the two countries have natural complementarities as in drugs and pharmaceuticals and IT and IT-related services and agro products.

“It is a matter of satisfaction that there is emerging focus on two-way investment flows,” he said.

The President noted that the bilateral trade between India and China has grown steadily since the turn of this century from USD 2.91 billion in 2000 to USD 71 billion last year.

Guangdon province boasts of a USD one trillion economy with high manufacturing and other industries along with being a powerful export house of China. It has sister province relationship with Gujarat and Maharashtra.

A pilot smart city cooperation project has been announced between Shenzhen and the Gujarat last year.

Referring to the links of 2nd century before the Christian era between Guangdong and Kanchipuram through a direct sea route, Mukherjee said this is an exciting time for India and China to reinforce the old linkages and join hands for new.

Noting that India has recorded a growth rate of 7.6 per cent each year for over a decade now, he said India believes that it cannot grow in isolation.

“In an increasingly interconnected world, India would like to benefit from technology advances and best practices of different countries.

“The comprehensive reforms introduced in key areas of our economy have enhanced the ease of doing business in India. Our foreign investment regime has been liberalised through simplified procedures. And removal of restrictions on foreign investments,” he said.

The President said these reforms have renewed the interest of global investors in India. In 2014, there was a 32 per cent growth in investments and in 2015, India emerged as one of the biggest global investment destinations, he said.

Mukherjee said India would like more of China’s overseas direct investment which has now crossed USD 100 billion mark.

He said the Indian government was setting up industrial corridors, national investment and manufacturing zones and dedicated freight corridors to stimulate investment in this sector.

Its ‘100 Smart Cities” initiative will transform India into a digitally empowered society and knowledge economy, he said.

“India welcomes your participation in these programmes. Chinese companies with inherent strengths in infrastructure and manufacturing can look towards India as an important destination in their ‘Going Global’ strategy.

“On their part, Indian companies can partner with Chinese enterprises in the new domain of ‘Internet of Things’ which underlines the ‘Made in China 2025’ strategy,” he said.

The President said he was happy to note that a good start has been made by Chinese businesses who are investing in infrastructure projects and industrial parks in India.

Bilateral cooperation in India’s railway sector is also progressing well, he said.

A good number of premier Indian IT firms and other manufacturers are present in China, he said and noted that Indian entrepreneurs were also considering the prospects of jointly exploring opportunities in third countries.
Summing up, the President said India believed there was great potential for economic and commercial cooperation among the two countries, which faced similar opportunities on coming together.

“To realise the full potential of our economic partnership, it is important to bridge the information gap between our business communities.

“We are committed to providing a conducive environment for more investments from China. We stand ready to facilitate many more collaborations between the industry and businesses of our two countries across different sectors. India invites investors from China to be partners in India’s growth story,” he said.

Source:
http://economictimes.indiatimes.com/articleshow/52428771.cms

India: PE firm Nalanda Capital to raise $620m for third fund

by | posted in: Corporate & Business Advisory Services, Corporate Updates, Cross Border Transactions, M&As, Joint Ventures, Economy, Business Updates, Corporate Affairs, India & International - Corporate updates | 0
Private equity firm Nalanda Capital has registered with the US market regulator Securities & Exchange Commission to raise $620 million for its new fund, according to an Economic Times report citing sources.
This will take the total corpus raised by the Singapore-resistered PE firm to $1.5 billion, the report said.
The new fund raise comes after five years as the company had raised $475 million for its second fund in 2011 and first fund of $400 million in 2007.
Nalanda Capital has built a large portfolio of India -based public-listed companies.
Some of its investments include in the companies like Just Dial, Lovable Lingerie, ELGI Equipments, TTK Prestige, Triveni Engineering and others.
Set up by ex-Warburg Pincus India managing director Pulak Prasad, the PE firm gradually raises its stake in the portfolio firms. Early this year, it had raised its holding in Mumbai-based Just Dial to 7.58 per cent.
Nalanda Capital also made some part-exits at the end of 2015 from companies like Lovable Lingerie and Triveni Engineering. The other PE firms which are focused on investing in public-listed companies, include ChrysCapital, Westbridge among others.
ChrysCapital has also closed first round of its seventh fund of $600 million in January this year. The PE firm had launched this fund in September last year and managed to raise $350 million by end of December as first round.

Last October, Westbridge Capital had also raised $575 million more to invest in Indian companies, as per a media report.

RBI starts meeting major players in P2P lending

by | posted in: Corporate & Business Advisory Services, Corporate Updates, Economy, Business Updates, Corporate Affairs | 0

After releasing a consultation paper on peer-to-peer (P2P) lending last week, Reserve Bank of India (RBI) has started meeting some leading players in the sector. The founder of a leading P2P lending platform, who met officials of RBI’s Department of Non-Banking Regulation on Wednesday, told FE on the condition of anonymity that the central bank is gearing up to come out with final guidelines for P2P lending platforms by the end of the current calendar year.

He also said that money laundering and interest rate are two of the main areas that the RBI is focusing on while framing the final guidelines for the sector. “It seems RBI is keen on capping the rate interest that a P2P lender can charge at the same level as that for non- banking finance company micro finance institutions (NBFC MFIs),” he said.

As per current RBI regulations, the maximum rate of interest that an NBFC MFI can charge is the lower of 10% more than its cost of funds and 2.75 times of the base rate of the top five commercial banks.

“While money laundering shouldn’t have been a big concern, given that draft guidelines have mandated that all transfer of funds happen directly from the lender’s bank account to that of the borrower, the unearthing of a few ponzi schemes in the P2P sector in China seem to have made the RBI more cautious,” the P2P lending platform’s founder added.

Post May 31, which is the deadline set by RBI for suggestions and comments on the regulations, it will work on the final guidelines and seems keen on releasing them by the end of the year, he added.

According to P2P Finance Association, the global P2P market almost doubled last year and has crossed the £5 billion mark.

“Although nascent in India and not significant in value yet, the potential benefits that P2P lending promises to various stakeholders and its associated risks to the financial system are too important to be ignored. The Reserve Bank has therefore found it necessary to put out this discussion paper to elicit public opinion and views of the various stakeholders on the future course of action having regard to the current legal and regulatory framework in place to regulate the business of financial intermediation,” RBI noted in the consultation paper.

It has also proposed a minimum capital requirement of R2 crore for P2P NBFCs and is intent on restricting such entities to just companies, thereby barring proprietorships, partnerships and LLPs.

Source: http://www.financialexpress.com/article/industry/banking-finance/rbi-starts-meeting-major-players-in-p2p-lending/248758/

Sumitomo likely to acquire 44% stake in Excel Crop Care

by | posted in: Corporate Updates, Cross Border Transactions, M&As, Joint Ventures, Economy, Business Updates, Corporate Affairs, India & International - Corporate updates | 0

Japanese conglomerate Sumitomo is at an advanced stage of negotiations to acquire a substantial equity stake in Excel Crop CareBSE -0.87 % , a Mumbai-headquartered listed company. The proposed deal could pave the way for the Japanese group to own about 44% shares of the pesticides and agrochemicals company for a total consideration ofRs 1,200-1,300 crore.

Sumitomo plans to buy out stake of Excel promoters — the Shroff family — holding 24.7% equity as well as two financial investors together owning close to 19% of the shares. ET’s email to Dipesh Shroff, managing director of Excel Crop Care, and Sumitomo Chemical went unanswered.

There have been several rounds of talks between officials of Sumitomo Chemical and the Excel management, and indications are that the deal may be signed in June. Nufarm, the Australian crop protection and specialist seeds company, owns more than 14% and is likely to retain its strategic stake in Excel Crop Care.

According to a report by Avendus Capital, global players are looking at India to increase their market share, add to their product portfolio , and strengthen their supply base in specialty and agrochemicals. “The Indian agrochemicals market is expected to grow rapidly (about 12% CAGR over 2014-19) with increase in farmer awareness, improvement in rural income and increase in pressure for improving productivity,” said Preet Mohan Singh, executive director, Avendus Capital.

The Shroffs are also the promoters of Excel Industries, a specialty chemicals company, and co-promoters of Aimco Pesticides in which they control a little over 25%. Before entering into any agreement with Sumitomo, the Shroffs are expected to conclude the inter se transfer of their holding to the other promoter family of Aimco. Excel Crop Care has 1.13% equity interest in Excel Industries.

Besides Shroffs, the other two shareholders of Excel Crop Care who may sell their shares to Sumitomo are Ratnabali Capital Markets (holding 14.99%) and Ratnabali Investments (3.95%). Among the institutional shareholders of Excel Crop Care are Life Insurance Corporation (6.58%) and DSP Blackrock (1.92%).

Excel Crop Care’s consolidated net profit for the quarter ended March 31, 2016 was Rs 7.6 crore as against Rs 1.7 crore in the year ago period, on total income of Rs 188.6 crore (Rs 205.6 crore). The Excel Crop Care stock has been trading at around Rs 1,109, against 52-week high and low of Rs 1,247 and Rs 750, respectively.

M&A activities in sectors like agro and specialty chemicals is expected to pick up, said Avendus, adding that the stride towards food security will also increase the significance of agrochemicals. An estimated 85% of India’s crop loss (worth close to $20 billion) is caused by pest infestation, disease and weeds and is prevented by the use of agrochemicals.

India exports agrochemicals to countries like the us , France, the Netherlands, Belgium, Germany, Brazil, Colombia, China, Vietnam and Indonesia.

Source: http://economictimes.indiatimes.com/articleshow/52392474.cms

Commercial realty witnesses rising interest from private equity funds

by | posted in: Corporate & Business Advisory Services, Corporate Updates, Cross Border Transactions, M&As, Joint Ventures, Economy, Business Updates, Corporate Affairs, India & International - Corporate updates | 0

The commercial real estate sector is witnessing increased interest from private equity funds, with several large institutions focusing on completed and leased commercial assets for investment.

In 2015, private equity real estate firms deployed more than $5 billion in Indian real estate companies and projects — the highest since the financial crisis of 2008 — through 90 deals, according to research from Venture Intelligence. Large investors and established developers also created several joint venture platforms in the past year, it said in a report.

Of the investment made, commercial projects accounted for 10%, it said. “Most of the private equity funds that India is receiving is from sovereign funds and pension funds,” said Sanjay Dutt, managing director, India, at realty consultants Cushman & Wakefield. “These funds prefer to invest in safer assets and have the potential to make long-term investments.” Completed leased commercial assets are seen as the best bet for these investors.

 

They have also been actively getting into tie-ups with builders to make investments in India. In one of such arrangements, Tata Group’s real estate and infrastructure development arm, Tata Realty & Infrastructure, partnered with Standard Chartered Private Equity to create a Rs 3,000 crore investment platform. While Goldman Sachs and Bengaluru-based property developer Nitesh Estates formed a $250 million fund to invest in income producing commercial real estate assets in India, APG and Xander also launched a $300 million India office venture.

Similarly, US private equity giant Blackstone formed a special purpose vehicle with Embassy Property Developers, while sovereign wealth fund Qatar Investment Authorities agreed to back real estate firm RMZ to buy commercial assets.

“The world economy is unstable and risk appetite among investors is going down. Funds want to invest in income-generating assets as they are looking for safe and long-term investment,” said Raj Menda, corporate chairman at RMZ. The company is further looking to raise $600 million to invest in income-generating assets.

From the REIT perspective, private equity funds that are planning to launch REITs are seeking to build a portfolio of commercial assets.

“Commercial platform is extremely important as office assets cannot survive merely on leverage (borrowed) money. Equity money is extremely important to increase quality of commercial assets and long-term success of real estate investment trust,” said Rajeev Bairathi, executive director of capital transactions group at Knight Frank India.

Meanwhile, better market outlook is prompting Milestone Capital to look at introducing a domestic commercial fund this year to deploy rent-earning pre-leased assets, of around Rs 1,000 crore.

“Assets are available at attractive valuations. With interest rates in a low range, higher capital appreciation is possible. We are already evaluating a few deals for investment,” said Rubi Arya, executive vice chairman of Milestone Capital Advisors.Milestone Capital is working also on exits worth Rs 700 crore, including Rs 500 crore from commercial assets in the next one year in the backdrop of a recovering office property market.

Source: http://economictimes.indiatimes.com/articleshow/52368876.cms

India moots framework for SME sector cooperation in BRICS

by | posted in: Corporate Updates, Economy, Business Updates, Corporate Affairs, India & International - Corporate updates | 0

India is working on a mechanism to boost cooperation amongst small and medium enterprises in the five-nation BRICS to promote joint ventures and share expertise on strengthening the sector.

New Delhi, which holds the Presidency of the BRICS this year, is drafting a framework for a joint growth strategy for micro, small and medium enterprises (MSMEs) in the region. “The framework for cooperation amongst MSMEs, which will identify the relative strengths of each country and also possible areas of joint ventures, will be discussed at the next meeting of officials in June and hopefully finalised at the BRICS ministerial meet in October,” a government official told BusinessLine . MSMEs in Brazil, for instance, are highly successful in participating in government procurements, he said, adding that they “capture almost 90 per cent of the business. Other countries could draw from Brazil’s legislative frameworks and other policy initiatives to help their small industry also get a chunk of government business.”

The BRICS grouping of five emerging economies — Brazil, Russia, India, China and South Africa — together account for a GDP of over $16 trillion, which is about half that of the seven major advanced economies. More than 40 per cent of the BRICS economies are driven by the MSME sector, according to government estimates.

The Commerce and Industry Ministry is also holding discussions with the industry to give a final shape to its proposal of putting in place a BRICS portal for addressing non-tariff measures (NTMs) that hamper trade between the BRICS.

Exporters’ body FIEO is one of the industry bodies giving inputs for the proposed portal.

“One of the biggest problems faced by exporters in the five countries is the lack of knowledge on various non-tariff measures (NTMs), such as new standards or specifications. Most of the times they get to know about the NTMs only when their goods are rejected. If this issue is addressed, it will serve as a big incentive for industry in the five nations to trade with each other,” said Ajay Sahai of FIEO.

Source: http://www.thehindubusinessline.com/todays-paper/india-moots-framework-for-sme-sector-cooperation-in-brics/article8617609.ece

World’s largest rooftop solar power plant inaugurated in Punjab

by | posted in: Corporate Updates, Economy, Business Updates, Corporate Affairs | 0

World’s largest single rooftop solar power plant of 11.5 Mw capacity was inaugurated in Beas near Amritsar in Punjab on Tuesday. Spread at a single rooftop stretch of 42 acre at Dera Baba Jaimal, the project was synchronized earlier this year.

According to Wikipedia,the Mandalay Bay Resort Convention Centre, Las Vegas in the United States is next biggest solar photovoltic power station in the world having 6.4 megawatts (Mw) capacity. The EPC contractors for the project were Tata Power Solar and Larsen and Toubro.

In addition to single largest rooftop solar power plant, seven rooftop solar power plants of 8Mw capacity were also inaugurated in Beas Dera campus making this place the highest single campus generating solar power of 19.5 Mw at multiple rooftops in the country, informed a senior official from Punjab Energy Development Agency (PEDA ).

Punjab is generating 470 Mw of solar power and with projects of 500 Mw in the pipeline, the state would be able to generate solar power of close to 1,000 Mw by the end of FY 2016-17.

New & Renewable Energy Resources Minister of Punjab Bikram Singh Majithia said this project would generate clean and green energy sufficient to power approximately 8,000 homes. He pointed out that GOL has set a target of power generation of 40,000 Mw from different resources of renewable energy to be achieved by 2022 and this project would be a role model to encourage other states to replicate such large rooftops on the building/sheds.

The investment in this sector has steeply gone up from Rs 82 crore in 2012 to nearly Rs 10,000 crore now with an employment potential of 12,500 jobs, he said. Punjab would achieve a target of 2552 MW of renewable energy generation by 2022, he added.

He said Punjab would achieve a target of 2552 MW of renewable energy generation by 2022.Solar projects have been executed on BOO (built-operate-own) basis and PEDA has entered into 25 year power purchase agreements with the private players.

Source: http://www.business-standard.com/article/economy-policy/world-s-largest-rooftop-solar-power-plant-inaugurated-in-punjab-116051701113_1.html