Macquarie SBI
Our fund
Macquarie SBI Infrastructure Fund (“MSIF”) provides its institutional and other large-scale investors located outside India with access to the growing number of investment opportunities available to the private sector in India’s infrastructure and infrastructure-like assets.
India’s economy has exhibited strong growth in recent years and is forecast to continue doing so. The demographic profile of the Indian population and the growth of India’s middle income and consumer class are already placing considerable pressure on India’s existing infrastructure. According to the Planning Commission of the Government of India, India’s infrastructure investment requirement over the five years 2012-2017 is estimated to be in the region of $US 1 trillion. A considerable proportion of this investment requirement is expected to come from the private sector.
MSIF invests mainly in assets that provide essential services to the local communities in which they operate, have sustainable competitive advantages, and deliver predictable cash flows over the long term.
Investments
MSIF has now invested over half its capital in businesses across power generation, telecom tower infrastructure and airports creating an investment portfolio that is well diversified by sector. Our co-investors are some of India’s leading participants in the infrastructure space including the Tata Group, GMR Group, Adhunik Group and Moser Baer India Ltd. A synopsis of current investments is as follows:
GMR Airports Holdings Ltd. (“GAH”)
| Amount: | USD 200 million |
| Investment Highlights: |
Representing 22% of the portfolio, GAH is a holding company of India’s two largest airports |
* Based on FY11 traffic data from Airports Authority of India
Viom Networks Limited (“Viom Networks”)
| Amount: | USD 253 million (including co-investment) |
| Investment Highlights: |
Accounting for 22% of the portfolio, Viom Networks is India’s second largest tower companies in terms of tenancies with approximately 15% market share. The company boasts of an average portfolio tenancy greater than 2.4x and has two major anchor tenants, TTSL and Uninor. Viom Networks is 55% owned by the Tata Group, one of the largest conglomerates of India with high standards of corporate governance. |
MB Power (Madhya Pradesh) Limited (“MB Power”)
| Amount: | USD 87 million |
| Investment Highlights: |
Representing 10% of the portfolio, MB Power (Madhya Pradesh) Ltd. is a 1200 MW coal based power plant being developed by Moser Baer group. With a strategic location in the power deficit Western Grid and an already in-place coal allocation from a subsidiary of Coal India Limited for the entire capacity, MB power has strong prospects in the region. Long term power purchase agreements are in place with a state utility and a power trading company for majority of the output. The remaining will be sold on a merchant basis. |
Adhunik Power and Natural Resources Limited (“Adhunik Power”)
| Amount: | USD 21.5 million |
| Investment Highlights: |
Accounting for 2% of the portfolio, Adhunik Power is a coal-based power plant located near Jamshedpur, Eastern India. With easy road, rail and air access, strong promoters (Adhunik Metaliks Limited, a listed company with a market capitalisation of approximately INR 11,370mn as at April 1, 2011) and a project allotted captive mine, execution risks in this greenfield investment are substantially mitigated. Long term power purchase agreements are expected to be in place for more than 60% of the output with the rest expected to be sold on a merchant basis. |
Soham Renewable Energy India Private Limited (“Soham”)
| Amount: | USD 19.5 million |
| Investment Highlights: |
Accounting for 2% of the portfolio, Soham is a hydro power holding company with 2 operational projects and 5 under implementation projects. In addition to the potential to provide attractive returns due to government initiatives such as Renewable Purchase Obligations, Generation based incentives and attractive Feed-in tariffs, this investment provides MSIF with a ready platform to develop and aggregate small hydro power plants in India. |
With portfolio diversification and attractive returns as primary objectives, MSIF continues to actively look at investment opportunities that fit its strategy and mandate.