MUMBAI: Global asset managers from KKR & Co to Blackstone Inc are ramping up investments in India and elevating locally-based executives to key regional roles, underscoring the nation’s rise in Asia’s private equity landscape.

Seven global funds now have their Asia private equity heads or co-heads based in Mumbai, including Blackstone’s Amit Dixit and KKR’s Gaurav Trehan.

That’s a sharp shift from just five years ago when none of the investment managers had Asia roles located in India.

Collectively, they oversee at least US$100bil in assets, according to Bloomberg News calculation based on public disclosure and people familiar with the matter.

The firms either declined to comment or did not respond to a request for comment on the value of assets they manage in the region. 

The pivot to India reflects a big reordering of global capital flows as investors look beyond China.

The South Asian nation offers strong economic expansion, with broader investment opportunities across sectors from infrastructure to manufacturing.

Local equity markets have also rallied in recent years and deal activity has surged.

That combination is making India a key anchor for buyout firms’ Asia strategies as they increasingly shift decision-making power to the country, along with Japan. 

“Many of the Asia heads now have demonstrated a strong track record and portfolio performance over time and managed teams effectively for years,” said Dhiraj Poddar, who became co-head of Asia at TA Associates in 2022.

“The Indian private equity market has matured. Deal sizes have increased, the buyout market has deepened and multiple avenues of exits have emerged.”

Still, high valuations of companies and turbulence among tech startups remain risks.

Washington’s move to double tariffs on most goods from the South Asian nation to 50%, among the highest in the world, is another challenge.

International investment firms are bulking up teams and diversifying asset classes in India in the search for strong returns, as China’s appeal wanes due to weaker growth and regulatory headwinds. 

“Most global general partners’ funds are raising Asia funds ex-China and are allocating anywhere between 50% to 70% to Japan and India, with the other countries, including South-East Asia, making up for the rest,” said Vivek Soni, a Mumbai-based partner at EY.

Blackstone, which has about US$50bil worth of private equity and real estate investments in India, has singled out India as its best investment market in the world.

KKR, which has deployed about US$11bil in the country over nearly two decades, is ramping up further. Co-founder Henry Kravis said in 2024 that the firm intends to invest its next US$10bil in the country at a faster pace.

Meanwhile, Boston-based Advent International, which is seeking to re-enter Japan in its Asia expansion, is turning to its managing partner for India, Shweta Jalan, to spearhead the move.

The veteran executive helped launch Advent’s Australia and New Zealand office last year, said a person familiar with the matter, asking not to be identified discussing company strategy. 

Elsewhere, senior executives from Brookfield Asset Management and investment firms PAG and TA Associates, now manage Asia or even global strategies from Mumbai.

The changes mirror what has already played out at global investment banks, where India-based chiefs have risen to regional prominence as the country’s equity markets take a larger share of Asia’s deal volumes. — Bloomberg