Temasek likely to invest $10 billion in India in the next three years

Singapore government’s sovereign wealth fund Temasek is looking to invest $10 billion in India during the next three years, Ravi Lambah, Temasek's head of India and strategic initiatives, said.

This investment is set to take Temasek's total India exposure to $47 billion.

“Our total mark-to-market India exposure, including our indirect exposure in Airtel through Singtel, is $37 billion, as of March end. We see the potential to deploy an additional $10 billion in the next three years, subject to finding the right opportunities,” Lambah told Business Standard on Monday. “This figure excludes what our subsidiaries will invest in India as they are also investing in the country,” he said.

For example, ST Telemedia, which is the largest data centre business in India, is expanding in the country. Similarly, Sembcorp Industries is looking at more renewable energy investment opportunities in the country. Ascendas India logistics, which is a joint venture company with Temasek, is also looking to grow its portfolio. Singapore Airlines is also investing more capital in Air India, Lambah said.

“We deployed $3 billion in India last year, our largest investment year to date,” he said, citing the $2 billion investment in Manipal Hospitals. Here, the Singapore state firm has increased its stake to 60 per cent.

Lambah said Manipal Hospitals may look at the option to launch an initial public offer (IPO) as all shareholders are aligned to taking the company public.

Temasek, he said, has been investing in India for the last 20 years, across market cycles and building a deep understanding of the market.

“Our India exposure makes up 7 per cent of our global portfolio by underlying assets, up from 4 per cent in 2020. Over the last decade, India has been Temasek's best-performing market globally,” Lambah said.

Chinese assets made up 19 per cent of Temasek's portfolio in FY24 – marginally down from 22 per cent in FY23.

Temasek is looking at four themes for investments — increasing lifespan via healthcare, consumption, digitisation and sustainability.

“India fits very well in our themes, and that’s why we invested in Manipal last year and had earlier invested in Medanta, Dr Agarwal and others,” Lambah said.

He added, “We are building our portfolio based on these themes. We had invested $100 million in Zomato 10 years ago when the company was starting its journey.”

As of today, Temasek's 1.94 per cent stake in Zomato is valued at Rs 4,000 crore ($478 million), according to Bloomberg.

Lambah said the firm is systematically building a resilient portfolio in India, focused on generating compound growth over the long term.

“We have not participated in the Indian government’s privatisation plan so far. But if opportunities are good, we will look at it,” he said.

“One of our investee companies Singapore Airlines has picked up a stake in Air India and has participated in the government’s privatisation drive,” Lambah said.

Outside Singapore, most of Temasek’s investment capital went to the United States, followed by India and Europe, as of last year.

In India, almost half of its portfolio consists of the financial services sector, including HDFC Bank, Axis Bank and ICICI Bank.

Lambah said the firm is a differentiated investor, focused on unlocking value through partnerships.

“Unlike private equity firms, we do not have any fund cycle and hence we are long-term asset owners, and able to deploy permanent capital,” Lambah said.

“We are open to both public and private equity; with the latter across early, growth and mature stages, in both minority and buyout opportunities,” he added.

Lambah did not comment on its reported offer to acquire Haldiram, but said consumption as a theme looks promising.

“The way domestic demand is increasing, wealth creation is taking place and GDP per capita is going up, it makes sense to look at assets in that segment,” Lambah said.

An industry source said Temasek had sold its 10 per cent stake in satellite TV broadcaster, Tata Play to Tata Sons, in the last financial year.