India-centric offshore funds take wings

Fund managers are aggressively selling the India theme to overseas investors. After Singapore-based Helios Capital’s fund manager Samir Arora’s India-focused Slumdog Millionaire Equity Fund, domestic brokerage firm India Infoline, run by Nirmal Jain, and Atlantis Investment Advisor headed by Vinay Gairola have launched India-focused off-shore funds.

While Gairola is trying to sell his India Alfa Fund to investors in West Asia, Singapore-based fund managers of India Infoline—Deepesh Pandey, the erstwhile deputy CIO of Mirae Asset, and Manish Srivastava, ex-fund manager of Halbis (HSBC Global Asset Management) — have conducted roadshows for the ‘Mumbai’ Fund in Hong Kong and US markets. Both are long-short equity funds and are likely to raise nearly $100 million.

Speaking to Business Standard form Singapore, Pandey said, “The Mumbai Fund would mainly invest in financial services and infrastructure stocks and will also take market-related directional calls aggressively.”

India Infoline Capital, the Singapore subsidiary of domestic brokerage India Infoline, would launch another India-focused fund ‘Ganges’ by the year-end. UBS is the prime broker for India Infoline Capital.

Gairola, who was in Dubai for the roadshow last week, said that his fund would target those corporates which are either planning major re-structuring of their businesses or going for acquisitions. “Cash would be aggressively used for hedging risk,” he said.

Gairola felt that the country would witness major merger and acquisiton activities as companies would look to acquire distressed firms and re-structure their business.

Apart from these, French financial major BNP Paribas in association with the Sundaram group and Reliance Capital, which already manages over $100 million of India-dedicated fund, would soon launch more off-shore funds.

Earlier this year, Reliance Capital had announced its plans to launch emerging market and Europe-focused funds in the UK. The launch was delayed as the recession was at its peak and investors were unwilling to commit fresh money to a new fund.

“However, off-shore or India-focused hedge funds are witnessing good inflows this year after a lull of nearly one year as Indian markets have been the best performer this year,” said an analyst at a Singapore-based hedge fund tracking firm.