South Korean PEFs pick India next hot spot for investment

[Source: Ninjacart]

South Korean private equity fund operators are gradually upping their investments in India that has been emerging as one of the most preferred destinations of foreign investments as once the world’s investment magnet China is grappling with the ongoing U.S.-China trade war.

South Korea’s private equity fund STIC Investment recently invested $10 million in Ninjacart, India’s No.1 grocery wholesale platform that allows users to trade agricultural produce via mobile application, according to sources from the investment banking industry. The Indian company pulled $45 million worth funds in total during the latest fundraising.

[Photo provided by Dunzo]

The Korean PEF already invested $10 million in Dunzo, a delivery company in India, in October 2019, and $10 million in Sahyadri Hospital in June 2020. “India has been aggressively attracting foreign money because its infrastructure is awfully inadequate despite its rapid economic growth,” a source from the IB industry said. “India has been one of the hottest spots for foreign investments including PEFs for several years.”

The Indian government launched ‘Make in India’ initiative to encourage foreign firms to enter the market in return for incentives. The Korea International Trade Association predicted India would be leading global economic recovery in the post Covid-19 era.

An IB industry official also said that PEFs that stockpiled a record high amount of dry powder, or cash reserves available to deploy when an attractive investment opportunity arises, are expected to pour their money into India once the Covid-19 crisis eases.

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