MUMBAI: Blackstone Inc, the world’s largest alternative asset manager, is aiming to raise $10 billion with its third Asia focused private equity fund, with a major portion allocated to India in 2025.
“We are in the process of raising a third Asia focused fund – with the first close expected in January. We do have some dry powder (unallocated capital) left in the second Asia fund, which will allow us to deploy capital in the first half of 2025, and third Asia fund will start investing by the third quarter of 2025,” said Prateek Roongta, Managing director of Blackstone Advisors India in an exclusive interview.
“While we’re aiming for a fund size of over $10 billion, we don’t have a precise figure yet. In terms of geographic allocation, the second Asia fund had a majority focus on India and Japan. For the third Asia fund, we expect a similar profile,” Roongta said on the eve of launch of 10th IPO from Blackstone’s portfolio companies in India. Blackstone is the largest PE investor in India with a cumulative investment of $50 billion in India including in real estate.
Blackstone owned International Gemmological Institute India will raise upto Rs 4,225 crore via an IPO which will open on December 13. With the IPO, Blackstone plans to dilute its stake by 24 per cent to 76 per cent from 100 percent.
Roongta said in 2024, Blackstone completed the Aadhar Housing Finance IPO and the next IPO by Ventive Hospitality, a hotel chain, is expected in January 2025. “It has been a strong year for us. We’ve had successful exits, including the Aadhar IPO and several private sales in other portfolio companies. For instance, we made partial exits in ASK Investment and VFS, and we executed a recap in PGP Glass. This is a positive outcome as two of our Asia funds, Asia 1 and Asia 2, are nearing the end of their cycles, necessitating some distribution of profits. As a result, 2024 has been a year focused on distribution of profits,” he added.
Roongta said over the past 15 years Blackstone was focused on just five sectors: industrial, consumer, fintech, technology, and healthcare. “We will continue to concentrate on these sectors in 2025 and won’t expand into the areas we don’t understand. Although consumer sentiment is softening, our investments are largely in indirect consumer sectors like PGP, EPL (formerly Essel Propack), and IGI India, which are poised for growth. Healthcare is a key focus for us as well, and with the Aster-Quality Care merger, we are now India’s third-largest hospital chain, which provides an exciting platform for expansion,” Roongta said.
“In fintech, we currently have four investments and are optimistic about continued growth in these areas,” he said.
Regarding India’s economic performance, Roongta said the recent slowdown in GDP growth in the September quarter isn’t a major concern. “We believe it’s a temporary dip, as authorities are balancing growth and inflation. While we may not see 8 per cent growth in FY25, a 7 percent growth rate is still healthy, and the government is working to stimulate economic activity, with the second half of the year expected to see improvement,” said he.
“For our portfolio companies, the Q4 of the calendar year period will be particularly strong due to the holiday season. Diwali and the festivities in the US, such as Christmas and Thanksgiving, are key drivers for jewelry sales, particularly in our certified jewelry business, which deals with both diamonds and gold.
Interestingly, the Blackstone PE investments are separate from the Blackstone real estate sector investments by separate funds which have been focusing on investments in areas such as data centers and warehousing platforms. While there have been some exits in private equity, real estate investments are still active, especially in India, which continues to be a significant recipient of capital from the global funds.
Meanwhile, the Rs 4,225 crore initial public offering (IPO) of diamond grader International Gemmological Institute India Ltd (IGI India), backed by private equity giant Blackstone Inc., is set to open this Friday. The proceeds will be used to acquire IGI Netherlands and IGI Belgium, estimated at Rs 1,300 crore, consolidating the company’s global footprint. The IPO includes an offer for sale (OFS) of Rs 2,750 crore by Blackstone, which will dilute its stake in IGI India to 76.6 percent, and a fresh issue of Rs 1,400 crore. The price band for the issue is fixed at Rs 397-Rs 417 per share. Founded in 1975 in Belgium, IGI is an independent certifier of diamonds, gemstones, and jewelry. It operates 29 laboratories and 18 gemology schools across 10 countries.
Source: Business Standard
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