JPMorgan plans to double PE investment in India to $1 billion

JPMorgan Chase & Co, the third-largest US bank, plans to double private equity investments in India to $1 billion as the nation’s equities head for the worst year on record.

The bank will also invest about $500 million to build its corporate finance and advisory operations, Kalpana Morparia, who took over as chief executive officer of JPMorgan in India on August 28, said in an interview in Mumbai yesterday.

Private equity investments in India climbed 3.2 per cent in the first six months of the year, bucking a 23 per cent decline for all of Asia. JPMorgan, which acquired Bear Stearns Cos in March in a bailout orchestrated by the Federal Reserve, has recorded about a quarter of the losses posted by Citigroup, its bigger rival, after the US home-loan market collapsed.

“Just given the state of public markets, there are opportunities for placements,’’ Morparia said. “When public markets don’t open up, they do placements.’’

Billionaire Anil Ambani and Dubai developer Emaar Properties were forced to cancel initial share sales in India this year as the Sensitive Index slumped 33 per cent.

Private equity investments in India climbed to almost $6.8 billion in the first half, surpassing the $5.8 billion invested in China, as new investments in Asia fell 23 per cent to $32.4 billion, according to the Hong Kong-based Asian Venture Capital Journal.

Private equity investment in India in the first eight months of this year is $8.6 billion, from $8.4 billion a year earlier, according to Venture Intelligence, a company that tracks private investments.

JPMorgan’s private equity unit has so far invested in L&T Infrastructure Development Projects, Apollo Hospitals & Enterprises and Cafe Coffee Day, among others, according to Venture Intelligence, a Chennai-based company that tracks investments.

JPMorgan will expand operations in India to five branches from one if the central bank gives its permission, Morparia said.

The Reserve Bank of India limits the number of branches an overseas bank may open in a year and curbs their holdings in local lenders. Some of these rules are scheduled to be reviewed in April.

“Banking has been quite conservative here,’’ said Morparia, who had previously worked for 33 years at ICICI Bank, India’s second largest. “Any new product we wish to introduce will be under more scrutiny.’’