pe monthly - sep 14 2009 - arfsl
TRANSCRIPT
8/3/2019 Pe Monthly - Sep 14 2009 - Arfsl
http://slidepdf.com/reader/full/pe-monthly-sep-14-2009-arfsl 1/5
Private Equity Group
he information contained in this update is for discussion purposes only. This update does not constitute an offer, solicitation, recommendation or investment advice with respect to any security or other transaction and should
lied upon as a basis for any investment decision. Anand Rathi Financial Services Limited and its affiliates may hold positions and effect transactions involving securities of issuers described herein. Anand Rathi Financial Services
nd its affiliates may also have been retained by such issuers to perform investment banking and other services, for which it receives compensation. The information contained in this update is based upon sources we believ
liable, but its acc uracy and completeness cannot be guaranteed. The market update is solely for the use of the i ntended recipients. Receipt of this market updat e by any person other than th e intended recipient, or usa ge of thi
pdate for any other purpose is prohibited. Please call +91-22-40477000 with any queries.
Monthly PE Update
Monday, Sep 14, 2009ssue no: MPEU/09/09 ** Approved by Private Equity Group for external distributio
Indian Economy Snapshot• For the week ending 29 August ’09, headline inflation (wholesale price index, WPI) was -0.12% as against -1.58% for the week ending
July ’09
• The Index of Industrial Production (IIP) grew 6.8% in July ’09 driven primarily by strong growth in consumer goods though there w
softening of growth in the core sector and contraction in exports.
• Exports in July ’09 contracted 28.4% year on year, while imports contracted 37.1% year on year. For FY10 year to date (Apr-July) expo
and imports contracted by 34.1% and 32.5%, respectively. Year on year export and import growth have been in negative territory sin
Oct ’08 and Nov ’08, respectively.
• The Sensex touched 6019.33 points or 62.39% in calendar year 2009 as on 31 August 2009. From a 3-year closing low of 8,160.40 on
March 2009, the Sensex is up 7506.24 points or 91.98% as on 31 August 2009. FII inflow in calendar year 2009 totaled Rs 40,284 cro
(till 28 August 2009).
• The latest government data showed the economy growing by 6.1% year-on-year during the first quarter (April-June) of the fiscal t
fastest for any quarter since the global financial crisis began almost a year ago. This growth rate means India remains the second-faste
growing major economy after China, which notched almost an 8% growth rate. More importantly, it's an improvement over the 5.8
notched up by India in the previous quarter and 5.3% recorded in the quarter before that.
Summary Of Private Equity DealsBreak-up of PE Deals in August 2009:
Based on No. of Deals
Financial
Services
13%
Healthcare
13%
Real Estate
7%
Infrastructure
13%
Others
41%Shipping &
Logistics
13%
Total No. of Deals: 15
Based on Amount
Financial
Services
31%Infrastructure
24%
Real Estate
18%
Healthcare
9%
Others
6%
Shipping &
Logistics
12%
Total Deal Amount: USD 170.1 million
Note: “Others” include Manufacturing, IT/ITES, Media & Entertainment and Other Services
Source: Anand Rathi Investment Banking Research
Contact: Arnab Banerjee – [email protected]
Sachin Mehta – [email protected]
8/3/2019 Pe Monthly - Sep 14 2009 - Arfsl
http://slidepdf.com/reader/full/pe-monthly-sep-14-2009-arfsl 2/5
Private Equity Group
he information contained in this update is for discussion purposes only. This update does not constitute an offer, solicitation, recommendation or investment advice with respect to any security or other transaction and should
lied upon as a basis for any investment decision. Anand Rathi Financial Services Limited and its affiliates may hold positions and effect transactions involving securities of issuers described herein. Anand Rathi Financial Services
nd its affiliates may also have been retained by such issuers to perform investment banking and other services, for which it receives compensation. The information contained in this update is based upon sources we believ
liable, but its acc uracy and completeness cannot be guaranteed. The market update is solely for the use of the i ntended recipients. Receipt of this market updat e by any person other than th e intended recipient, or usa ge of thi
pdate for any other purpose is prohibited. Please call +91-22-40477000 with any queries.
PE Investments in India:
July '09 vs August '09
218.2
170.1
21
15
0.0
50.0
100.0
150.0
200.0
250.0
Jul, 2009 Aug, 2009
U S D i n m i l l i o n
0
10
20
30
40
50
Amount (USD in million) No of Deals
Source: Anand Rathi Investment Banking Research
Private Equity Industry in IndiaInvestments worth USD 170.1 million across 15 deals were made in August ‘09. Financial services and healthcare continued being amon
the most favoured destinations for PE funds. Liquidity pressure seems to be driving PE firms towards open market exits as many of th
exits are at prices lower than the investment price.
Key PE Deals announced in August 2009:
Company Sector PE Investor Amount
(USD in millions)
Stake
Berger Paints Manufacturing(Paints)
Nalanda Capital 7.1 2.2%
Continental Warehousing Nhava
Sheva
Shipping & Logistics
(Container freight)
Aureos India, ePlanet Ventures 16.0 NA
DiagnoSearch Life Sciences Healthcare & Life Sciences
(CRO)
JM Financial 7.0 NA
GEI Industrial Systems Manufacturing
(Industrial cooling systems)
BanyanTree Growth Capital 2.2 10.0%
McNally Sayaji Engineering Infrastructure
(Engg. & Construction)
EIG 1.5 9.8%
Neo Corp International Manufacturing
(Textiles)
IndiaCo NA NA
NovaLead Pharma Healthcare & Life Sciences
(Pharmaceuticals)
Undisclosed 8.0 NA
Ramky Infrastructure Infrastructure StanChart PE 40.0 10.0%
Saraplast Other Services
(Portable toilets)
Aavishkaar NA 21.0%
8/3/2019 Pe Monthly - Sep 14 2009 - Arfsl
http://slidepdf.com/reader/full/pe-monthly-sep-14-2009-arfsl 3/5
Private Equity Group
he information contained in this update is for discussion purposes only. This update does not constitute an offer, solicitation, recommendation or investment advice with respect to any security or other transaction and should
lied upon as a basis for any investment decision. Anand Rathi Financial Services Limited and its affiliates may hold positions and effect transactions involving securities of issuers described herein. Anand Rathi Financial Services
nd its affiliates may also have been retained by such issuers to perform investment banking and other services, for which it receives compensation. The information contained in this update is based upon sources we believ
liable, but its acc uracy and completeness cannot be guaranteed. The market update is solely for the use of the i ntended recipients. Receipt of this market updat e by any person other than th e intended recipient, or usa ge of thi
pdate for any other purpose is prohibited. Please call +91-22-40477000 with any queries.
Company Sector PE Investor Amount
(USD in millions)
Stake
Shriram City Union Finance Financial Services
(NBFC: consumer finance)
Norwest 3.0 NA
Snowman Frozen Foods Shipping & Logistics
(Cold chain)
IFC 5.0 NA
Spandana Financial Services
(Microfinance)
Temasek 50.0 10.0%
Synergy Media Media & Entertainment
(FM Radio)
Warburg Pincus 0.3 3.2%
VMOps IT/ITES
(IT products)
Nexus India Capital NA NA
3C Company (SPV level) Real Estate Redfort Capital 30.0 50.0%
Key Funds Proposed/Closed in August 2009:Firm Fund Name Target Amount
(USD in millions)
Amount Raised
(USD in millions)
Date of
Announceme
Redwod-DHFL JV NA NA to be raised 07 Aug, 2009
LGT Capital Partners Crown Global Secondaries II 750.0 268 (first close) 12 Aug, 2009
TA Associates TA XI NA 4000.0 12 Aug, 2009
Morpheus Venture Partners NA 0.2-0.5 to be raised 20 Aug, 2009
Source: Anand Rathi Investment Banking Research
PE Backed M&A Exits in August 2009:
PE Investor Company Sector Acquirer Deal Amount
(USD in millio
Lok Capital Spandana Financial Services
(Microfinance)
Temasek 12.5
NA Tejas Networks IT/ITES
(Optical networking
equipment)
Frontline Strategy NA
Sequoia Capital;
Battery Ventures
Travelguru IT/ITES
(Travel portal)
Travelocity NA
Source: Anand Rathi Investment Banking Research
8/3/2019 Pe Monthly - Sep 14 2009 - Arfsl
http://slidepdf.com/reader/full/pe-monthly-sep-14-2009-arfsl 4/5
Private Equity Group
he information contained in this update is for discussion purposes only. This update does not constitute an offer, solicitation, recommendation or investment advice with respect to any security or other transaction and should
lied upon as a basis for any investment decision. Anand Rathi Financial Services Limited and its affiliates may hold positions and effect transactions involving securities of issuers described herein. Anand Rathi Financial Services
nd its affiliates may also have been retained by such issuers to perform investment banking and other services, for which it receives compensation. The information contained in this update is based upon sources we believ
liable, but its acc uracy and completeness cannot be guaranteed. The market update is solely for the use of the i ntended recipients. Receipt of this market updat e by any person other than th e intended recipient, or usa ge of thi
pdate for any other purpose is prohibited. Please call +91-22-40477000 with any queries.
PE Backed Open Market Exits in August 2009:
PE Investor Company Sector Acquirer Deal Amount
(USD in millio
Capital International Mindtree IT/ITES(IT Services) NA 15.0
Morgan Stanley
Investment Management
Godesic IT/ITES
(Mobile VAS)
NA 57.8
Spinnaker Capital IG Petrochemicals Manufacturing
(petrochemicals)
NA 2.0
IIML JBF Industries Manufacturing
(Textiles)
NA 1.4
JM Financial LIC Housing Finance Financial Services
(Housing Finance)
NA NA
Spinnaker Capital Pennar Industries Manufacturing
(Steel)
NA 2.5
Chrys Capital Shriram Transport Finance Financial Services(Truck Finance)
NA 48.0
Source: Anand Rathi Investment Banking Research
IPO Exits by PE Firms in August 2009:
PE Investor Company Sector IPO Size
(USD in Millions)
3i Adani Power Energy
(Power)
604.0
Source: Anand Rathi Investment Banking Research
Emerging Trends in the Indian Private Equity SpacePE investor backed Shipping and Logistics companies looking to move up the vale chain
• Logistics industry growth is primarily driven by the domestic consumption story making it relatively de-coupled from the glob
downturn
• However, the logistics industry in India is very unorganised and fragmented with most of the logistics companies essentially bei
transport companies
• So the opportunity lies for professionally managed logistics companies to provide value added services (storage services, packagin
labeling, etc.) in addition to transportation by using technology and process management
• With strong PE focus in this field, the logistics companies are expected to quickly move up the value chain
Financial services: Return of investor interest
• The financial services industry was one of the worst affected industries in the global economic turmoil which was probab
responsible for the limited investor interest in this industry even in India over the last year
• Over the last few months, however, private equity investors have been very active in the financial industry space
• A part of this interest is in the microfinance space which has strong underlying demand drivers to justify the interest
• However, there has also been enough investor interest in the non-microfinance financial services space
8/3/2019 Pe Monthly - Sep 14 2009 - Arfsl
http://slidepdf.com/reader/full/pe-monthly-sep-14-2009-arfsl 5/5
Private Equity Group
he information contained in this update is for discussion purposes only. This update does not constitute an offer, solicitation, recommendation or investment advice with respect to any security or other transaction and should
lied upon as a basis for any investment decision. Anand Rathi Financial Services Limited and its affiliates may hold positions and effect transactions involving securities of issuers described herein. Anand Rathi Financial Services
nd its affiliates may also have been retained by such issuers to perform investment banking and other services, for which it receives compensation. The information contained in this update is based upon sources we believ
liable, but its acc uracy and completeness cannot be guaranteed. The market update is solely for the use of the i ntended recipients. Receipt of this market updat e by any person other than th e intended recipient, or usa ge of thi
pdate for any other purpose is prohibited. Please call +91-22-40477000 with any queries.
• This is probably driven by the fact that as most of the larger global investment banks are now out of the picture there is a hu
opportunity for local financial services players to become a leading full service investment bank
• It’s not only the private equity investors but also the larger business houses who have stated their interest in starting an investme
bank to tap this opportunity
The BPO sector expected to heat up with increased M&A activity
• The economic downturn in the US, which accounts for more than 50% of the export revenue for the Indian BPO industry, had sever
affected companies in this sector making many of these companies possible acquisition targets
• The international economic environment seems to be improving and some of the larger players now have better visibility of the
future revenues which could encourage them to go for growth through the inorganic route
• Though the IT services space has seen very limited private equity investment over the last few months, the BPO sector seems to
consistently garnering some PE interest
• A part of this capital raised through the PE route over the past few months is expected to go towards acquisitions