Aniket Pujari“India is the largest private equity destination for us outside the US. It’s always been one of our most important markets globally. In many ways, I think our presence in India and the ecosystem that we’ve created here may be one of the most defining features of the firm more broadly, not just inside India, but outside of it,” Chip Kaye, chairman, Warburg Pincus, said.
Kaye and Jeffrey Perlman, the firm’s chief executive, along with other senior management, are in India to celebrate their 30-year investing journey. Starting with backing entrepreneurs and businesses such as Sunil Mittal, HDFC, IDFC, among others, the firm has, over the last three decades, backed 80 companies.
“We are now investing a couple of billion dollars each year in India,” said Narendra Ostawal, India head at the firm, adding, “You can say, we are investing more in a year than we would have done in a decade. That speaks about our level of commitment to the region.”
Reflecting on how the firm is operating in a world defined by geopolitical realignment, supply chain reconfiguration, and rapid technological change, especially in artificial intelligence (AI), Perlman said that, in that context, India stands out. “India combines scale with growth, rising domestic demand and a deep entrepreneurial ecosystem. And with an increasingly sophisticated capital markets, which we think is critical for the success of any investor or investing franchise, I think in a world of structurally higher rates, India continues to stand out.”
Distribution of returns
According to Perlman, the firm is probably one of the few private equity firms that has meaningfully distributed more capital to its investors than it has invested in the (Indian) market. “That is a rarity,” he added.
The firm pursues classic private equity-style deals in India, buyout opportunities, and real estate. The firm is also smelling an opportunity in bringing its capital solutions business to India, Perlman added.
“It is a market where we’re now investing probably upwards of a few billion dollars a year across private equity, real estate, and ultimately in areas, hopefully in the future, like capital solutions,” Perlman said. The number of majority-control buyout transactions has also changed. The company’s business has evolved over time, but the scale of that opportunity is different from what it was even 10 or five years ago.
Indian companies are increasingly looking beyond their domestic borders, creating opportunities spanning multiple markets that require partners with global resources and capabilities, Perlman said, adding, “That is another big opportunity for us.”
Since its entry into India, some of its global peers, including Blackstone, KKR, Carlyle, Bain Capital, EQT, and General Atlantic, have set up shop and are now competing for a larger share of the growing private equity pie in India. Asked if growing competition has made it difficult for them, Perlman said, “More capital on the front end coming to take advantage of the opportunity set here. Because in private equity, you need more capital for exits.”
Earlier this year, Bharti Enterprises and Warburg Pincus together acquired a 49% stake in Haier India, a subsidiary of the Haier Group. The private equity firm also acquired a 41% stake in Fleur Hotels in January.
Globally, the investment firm has more than $100 billion in assets under management, and more than 215 companies in its current portfolio, diversified across stages, sectors, and geographies. Warburg has invested in more than 1,000 companies across its private equity, real estate, and capital solutions strategies.
