The whole transition of our economy needs to work on all levels, on both a global level and a grassroots level: Shri Jayant Sinha

The whole transition of our economy needs to work on all levels, on both a global level and a grassroots level: Shri Jayant Sinha

Viney Sawhney, Finance Professor, Harvard University started the IVCA Conclave on Day 3 by saying, “The year 2021 turned out to be a spectacular year for private markets. We can expect 2022 to be a good year but not a record-breaking one.” 

He further added, “Most firms plan to go to market in 2022. 80% of them plan to raise capital this year. The 4th quarter of 2021 was record-breaking for the 5 largest 5 PE firms. Despite the current situation, optimism is still high,” Said Viney

Ankur Pahwa, E-commerce and Consumer Internet Leader, Transactions Diligence Partner, EY India said “The rise in late-stage investments also resulted in creating Indian tech unicorns, giving rise to 40+ unicorns across fintech, B2C and B2B commerce and payments,” 

He further stated “The e-commerce and internet space continues to witness consolidation as businesses leverage collaboration to drive growth. We shall witness expanding portfolios of D2C brands, more brand aggregators, and faster creation of unicorns in near future,” added Ankur Pahwa.

National, 11, March 2022: The IVCA Conclave is India’s premier private equity and venture capital event. This annual flagship event is now in its 11th year. This exclusive event focused on Diverse Focus Areas encapsulating ESG, greater allocations in India and India’s path to the energy transition. On the final day of the conclave, IVCA hosted the IVCA PE/ VC Awards. 

Expanding the ambit of its much-coveted annual IVCA PE-VC Awards, the idea behind initiating the PE-VC awards has been to showcase the stakeholders, government, and the country as a whole and bring larger community focus on the industry by recognizing their achievements, this year, IVCA, focussed on promoting outstanding action for better Gender Diversity, Private Equity Investing, fundraising and more. 

Sequoia Capital was recognized as Best Exit Performance of the Year, as well as Best Fundraising Performer of the Year in Venture Capital (Foreign GP), while Chiratae Ventures was recognized as the Best Fundraising Performer of the Year in Venture Capital (Indian GP). 

Awardees in other categories are: 

Exemplar Ecosystem Enabler Award – Mr Gopal Srinivasan

Lifetime Achievement Award – Mr Saurabh Srivastava

Exemplary Career in Private Equity Investing (posthumously) – Mr Ajay Relan

Private Equity – Best Exit Performance of the Year – Multiples

Private Equity – Best Exit Performance of the Year – Warburg Pincus

Outstanding Achievement of the Year –  Action on Gender Diversity – Elevar Equity

Outstanding Achievement of the Year –  Social Impact – Omnivore

Outstanding Achievement of the Year –  New Fund Entry – ADQ

Private Equity – Best Fundraising Performance of the Year – Kedaara Capital

To celebrate Gender Diversity in the PC-VC ecosystem. IVCA has kept DE&I at the centre stage of IVCA Conclave 2022. In the video, the women and men who are making a difference and partnering with IVCA have talked about promoting gender diversity.

Some key takeaways from #IVCA Conclave Day 3 –

1. Ankur Pahwa, E-commerce and Consumer Internet Leader, Transactions Diligence Partner, EY launched the IVCA-EY-eCommerce and consumer internet India Trend book 2022:

Key pointers in the report: 

India’s consumer digital economy is expected to be a US$800 billion market in 2030, registering a ~10x growth from 2020

PE/VC investments in Indian internet and e-commerce witnessed 370% y-o-y growth in 2021

Fintech remains the largest and fastest-growing in terms of PE/VC investment 

While small ticket investments in the Indian e-commerce and Internet sector continues to account for over 60% of total PE/VC investments, there has been a notable increase in large ticket investments, with growth in late-stage funding

2. Panel Discussion: Five Big unlocks for greater allocations to India: 

Divya Sehgal, Partner, True North said “The alternate asset strategy should be a good multiple of what we deploy from the private equity side,” 

“One of the positive things that have happened is that the pools of capital have deepened and talent always precedes capital not the other way round,” Divya further added. 

“India as an asset class is being truly recognized. We must focus on how to take it to the next level. When we look at India as an investment option, we are compared to other emerging markets,” said Manish Kejriwal Managing Partner, Kedaara Capital

S. Sriniwasan Managing Director, Kotak Alternate Assets added “One of the key challenges that we face is the currency risk of investing in India. We must break the so-called perception that we know how to do business in our country,” 

He further stated “I am quite hopeful and look forward to centralised regulatory changes. we have reached critical mass. It is time that we as an industry continue to have pushback on dollar hurdles,” 

“One of the challenges we have is  – how to reorganise a failed business. It is a cumbersome process and it dissuades others as well. Despite good intentions, we still haven’t got it right. Allowing businesses to restructure their losses is important,” said Sudhir Variyar Managing Director & Deputy CEO, Multiples Alternate Asset Management

3. Panel Discussion: ESG: Role private alternatives can play in having a meaningful Impact:  

“ESG requirements cannot be done overnight.  Even though we had 30% diversity, the key decision-making levels stood at 7% diversity. We worked on that if we had to preach the same,” said Anita Marangoly George, Investor. 

Anjali Bansal Founder, Avaana Capital added “ESG is no longer a narrow vertical that should sit in CSR but it is actually the next big opportunity. What digitization was for the last 20 years, sustainability will be for the next 20,” 

“Sustainability will be the next big opportunity. ESG is not CSR anymore. First  – Capital spoke, then the consumer and then the community – which meant suppliers and employees.

India is the third-largest emittor in the world and hence conversations around sustainability cannot be complete without India,” Anjali further explained. 

Dhanpal Jhaveri Vice Chairman, Everstone Group & CEO, EverSource Capital said “It’s the incredible groundswell of action that we have seen between the 4 C’s, the citizens, the corporates, the capitalist, and the country, to bring about the change and make it happen,” 

He further added “We have made sure that ESG has been completely integrated into our investment process. All the 4 C’s have come together  – Country, consumer, corporates and citizens,” 

Dr Mukund Rajan Chairman, Ecube Investment Advisors said “A bunch of converging trends have been building up over time like greater awareness, use of social media, issues like climate change, which is why ESG is now the centre stage,” 

Dr Vikram Popli, Director of Investments, Leapfrog added “As an impact fund, our focus and our approach is to be a driver of growth, global thought leadership, and be a standard-setter rather than a follower,” 

4. In a panel discussion, CAT III Investments: Promising decade; Bright future: 

Andrew Holland CEO – Public Markets Alternate Strategies, Avendus Capital Public Markets Alternate Strategies LLP said “Hedge funds represent around 5% of total assets under management but more significantly they represent 40% of total revenues,” 

Akshay Mansukhani Managing Partner, Malabar Investments added “Buy businesses that compound for many years. Different managers do different things, but it boils down to consistently generating alpha over different markets,” 

He further stated “The PMS was not something that would work, because simplicity in real life is important,” 

Dr Pritesh Majmudar Head – Legal and Compliance, DSP group said “The SEBI approved framework can be viewed as a step forward for a more relaxed regulatory environment, especially for the sophisticated investors,” 

“The growth of CAT III AIF industry is broad-based and secular in nature. Some managers are dabbling in commodities and multi-asset investments,” said Nalin Moniz CIO – Alternative Equity, Edelweiss Asset Management Limited. 

Shahzad Madon Head – Alternative Assets, Nippon Life India AIF Management Limited (Moderator) said “We have seen the emergence of innovative and unique offerings over time that are distinctive as compared to traditional investments,” 

5. In the fire chat session Domestic Capital for AIFs: A Strategic Perspective, Shri. S. Ramann, Chairman and Managing Director, SIDBI said “It’s important that we acknowledge the role of the investment committee in guiding the growth of the entire volume of funds. With the efforts of all of us, we have managed to get the concept of risk capital once again thriving,” 

Ramann further added “There nearly about a 1000 cr gone into Tier 2 and 3 cities. We are looking at growth, we can exploit the synergies that have been created in the infrastructure. SIDBI did a lot of work with Fintech lenders and financed a lot of them,” 

“One of the fastest-growing sectors is the tech-oriented startup. Use domestic pools of capital to leverage it against global pools of capital,” advised Ranjit Shah Managing Partner, Gaja Capital. 

6. Panel Discussion: Panel Discussion: Exits in a Volatile Environment

Bharat Singh Operating Partner, Sequoia Capital said “IPO is just an event in the life cycle of the company. We are with companies from idea to IPO and beyond. Having a negative PNL company is very new for the investors,” 

Bharat added, “SEBI also wants to ensure increased transparency for the retail investors. Sometimes the best value is yet to come even after an IPO as the company is on a growth trajectory. Most of the investments in these companies are growth-oriented,” 

Jayanta Basu Managing Partner, CX Partners said “The environment has been edgy in the public market. We should be worried about pricing. There must be something left for the investors so that they keep coming back. Fast-growing companies have an edge. More value will be given to companies that have been giving consistent results,” 

“On the public side, there needs to be something left on the table for investors. On the private market, both sides are mature. The benchmark that the public market has set has also affected the private market in terms of pricing,” Jayanta further added. 

Promeet Ghosh Deputy Head – India, Temasek Holdings said “The importance of public markets is that they also impact the private markets. Private investors are betting on loss-making companies because they have a sustainable advantage over the others in the long run,” 

Srinath Srinivasan CEO, Oman India Joint Investment Fund Management Company said “The FII pulled about 30 billion dollars over the last 6 months. The optimism is continuing and is also very pragmatic because tips are coming in and people are investing in the market.,” 

Srinath further added “Last year has not been about margins and ROEs. We need a balance of these and growth. In volatile times, you may not exit your full investment, but you should definitely participate in a liquidity event. We are optimistic that by the middle of the year things will be back to normal,” 

Rishi Aswani Managing Director – Alternative Asset Advisory, Duff & Phelps, a Kroll Business (Moderator) said “We have had exits through various routes and valuations have been disparaged,”

7. In a fireside chat: Fireside Chat: India’s path to the energy transition, Shri Jayant Sinha Chairperson Of The Standing Committee For Finance, Parliament Of India And BJP Lok Sabha Member Of Parliament From Hazaribagh, Jharkhand said “If we can get the global carbon credit scheme working then even at the grassroots we can get the benefits of carbon credit schemes and help more people to undertake this transition. As far as industry is concerned, they have to start moving towards alternate sources of energy such as green hydrogen, bio-fuels, and even electricity as well,” 

Shri Jayant further said, “Good market for carbon credit is being established in the EU, which is a model for how we can create a global carbon trading and pricing system. If we can get the global carbon credit scheme working then even at the grassroots we can get the benefits of carbon credit schemes and help more people to undertake this transition,” 

Vineet Rai Founder, of Aavishkaar Group and Managing Partner, Aavishkaar Capital said “Transition financing is going to be a very large area to drive large funds. There is a definite need for SMEs and MSMEs to change as well. We are the first Asia-level fund that has been certified 2X flagship,” 

“There is a model that already exists, we need to integrate it in the Indian market,” added Vineet. 

About IVCA:

Established, for over a decade, by industry professionals with a unified aim to drive forward Alternate capital industry in India. The IVCA (Indians Venture and Alternate Capital Association) is India’s apex body representing the interests of the PE/VC industry, Real estate, Infrastructure and Credit funds, Limited Partners, Family offices & Corporate VCs.

IVCA is a non-profit organisation powered by its members. The member firms comprise firms from around the world including investment managers, investment advisors, general partners, funds whose sponsors are sovereign wealth funds, pension funds, national Governments, large Government entities, bilateral/multilateral financial institutions; high net worth individuals and family offices.

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