India a top priority market for KKR’s Asia infra play

Since 2019, KKR has poured over $1 billion into Indian infrastructure deals, amassing a portfolio exceeding $3 billion in assets under management in the country. “Roughly around 25-30% of the fund I was invested in India and we expect to continue, if not more, with similar deal flow,” he said.

KKR’s investments in India have been made through its $3.9 billion first fund, with the firm now actively deploying capital from its second fund across key Asian markets, including Korea, India, Japan, and Southeast Asia, while also exploring opportunities in Australia and New Zealand.

Notable investments in India include Serentica Renewables, Indigrid, and Hero Future Energies, underscoring the market’s priority status within KKR’s Asian portfolio. 

Shah, speaking at a media roundtable, emphasized India’s significant role across both of KKR’s funds, supported strongly by limited partners (LPs) encouraging more investments in the region.

According to Shah, India is becoming a deep market. “Probably the deepest market in Asia in terms of the opportunity,” he added.

KKR’s strategic focus in India spans power transmission assets with India Grid Trust (Indigrid), renewable energy platforms like Virescent Infrastructure and Hero Future Energies, highway networks through Highway Infrastructure Trust, decarbonization efforts with Serentica Renewables, and logistics with Leap India.

Looking ahead, KKR aims to diversify its Indian portfolio equally across roads, renewables, and other promising sectors. With a cumulative investment of $10 billion in India, infrastructure remains a key growth area for the firm.

KKR is set to pursue more energy and highway projects under the Toll-Operate-Transfer (ToT) model and is closely monitoring developments in India’s battery storage infrastructure. This includes bidding on a project in Kerala through Hero Future Energies and initiating a small battery storage project in Delhi with Serentica, he said.

Shah highlighted the evolution of the Indian market over the past 15 years, noting a significant maturation in asset availability and investment viability, alongside a more discerning approach from investors. 

“And there’s more precedent, there’s more certainty on the government, in terms of their decision making, etc. So, I think there’s more maturity built up, there’s more knowledge built up, there’s more sense built upon what we can do what we can’t, and then you stay away from what you can’t do,” he added.

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Published: 22 Feb 2024, 08:02 PM IST