A

Project Report
On

Submitted By: Priyanka Kale

For: M.B.A PDGM-FINANCE

Submitted To:WELLINGKAR INSTITUTE OF MANAGEMENT

PRIVATE EQUITY IN INDIA 

TABLE OF CONTENTS

Acknowledgement ………………………………………………………………………….3
Abstract …………….……………………………………………………………………….. 4
Objective ……………………………………………………………………………………. 6
Definition …………………………………………………………………………………… 7
Private Equity: Current Scenario ………………………………………………………… 8
Types of Private Equity.………………………………………………………………….. .12
The stages of Private Equity ...…………………...………………………………………. 15
Process of Private Equity Investment …………………………………..………………. 16
Advantages of Private Equity …………………………………………………………… 18
Disadvantages of Private Equity …………………………………………………………20
Ways of investment (Entry Route) ……………………………………………………….. 22
Ways of Exit ……………………………………………………………………………….... 24
Major Private Equity Deals in India
™ Warburg-Pincus & Bharti Tele Ventures……………………………………….. 28
™ Dalmia Cement & KKR …………………………………………………………...40
™ Air-Deccan & ICICI Ventures and CI ……………………………………………42
™ Paras Pharmaceuticals & Actis ………………………………………………….. 44
™ Shriram Transport Finance & TPG …………………………………………….... 46
™ Gokaldas Exports Ltd. & Blackstone ………………………………………….... 48
Success of Private Equity in India ………………………………………………………. 50
Future of Private Equity in India ……………………………………………………….. 52
SEBI Guidelines …………………………………………………………………………… 54
World’s Top 10 Private Equity Firms …………………………………………………… 57
Comparing the Indian PE environment to other countries …………………………… 58
Introduction of Khandwala Securities Limited …………………………………………59
References ………………………………………………………………………………...... 61

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Acknowledgement

I take this opportunity to express my profound and sincere gratitude to

Mr. Rajesh
Katare (Manager Execution - IBG) for his inputs and feedback in
developing this
project. His guidance, continued support, constructive criticism and
suggestions helped
invaluably in shaping the form and content of this report.

I acknowledge and thank with deep sense of gratitude to Mr. Giriraj Daga
(Research
Analyst) for his constant support and invaluable suggestions right from
the conception
to the design and completion of the project.

I also acknowledge and thankful to Mr. Ankit Kothari (Junior Analyst -

IBG) for his
consistent eye watching on report and for providing better ideas and
suggestions to
improve the project.

This project will help me in understanding the global investment pattern

and factors
influencing it. It will also helpful in understand the future scenario of
Private Equity in
India. I am sure that project is very useful to know that why PE firms
are successful in
India.

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Abstract

India has been witnessing dramatic shift in the size and composition of
foreign
investment inflows over the couple of years. Institutional investors in
developed
countries, for their portfolio diversification, are continuously seeking
new destinations
and innovative and alternative asset class. The Private Equity is the
best alternative for
raise money from an investment.

The Private Equity sector is broadly defined as investing in a company

through a
negotiated process. Investments typically involve a transformational,
value-added,
active management strategy. Typical forms of private equity include
venture capital,
growth and mezzanine capital, angel investing and private equity funds.

The major PE investments influencing the deal values are Real Estate,
IT/IT Services
and Energy sectors. The other sectors, which have significantly
contributed to private
equity deal value, are Logistics and Telecom. The most active sectors in
terms of deal
volume were IT/IT Services and Manufacturing. Other sectors contributing
significantly to deal volume were Banking, Finance and Insurance and Real
estate.

The PE investment pattern follows various stages, which are: seed, start-
up, expansion
and replacement stages. It also follows a definite process, which is Deal
Origination
(Deal Sourcing), Due Diligence, Deal Negotiation, Deal Closing
(Acquisition), Post
Acquisition Monitoring and Exit (IPO, Trade Sale or Buy back).

The Indian Private Equity sector consists of many historical deals so

far. Among them
“Warburg Pincus – Bharti Tele Venture” deal was beginning of the PE era
in India. By
this deal WP earned 450 % return on its investment which is the biggest
earning by any
PE fund worldwide. On the other hand Bharti Tele Ventures Ltd. has result
as huge
growth in its subscribers and became 2nd largest telecom company in
India. After the
deal with Warburg Pincus, Bharti spread its business worldwide. Currently
Bharti have
its operations not only in India, but also in Bangladesh, Sri Lanka and
15 countries in
South Africa. Subsequently Bharti became 5th largest telecom service
provider all over
the world.

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The project would deal with understanding the role of private equity in
India,
analyzing their investment strategies, their success in the Indian
financial market, future
of Private Equity in India, regulatory norms in India and how it is
beneficial of Indian
companies. An attempt will also be made to understand their investment
patterns.

The project also includes the understanding of competitive profile of

different players in
Private Equity in India and the different types of funding done by them
in India like -
seed funding, expansion capital, and buyout financing, financing
restructuring of
companies and providing mezzanine capital. These all types are discussed
in “Major
Private Equity Deals in India.”

The project is consists of top PE firms in the world. According to

Private Equity
International (PEI), the largest private equity firm in the world today
is TPG, based on
the amount of private equity direct-investment capital. Some other
players in this
ranking are; Goldman Sachs Capital Partners, The Carlyle Group, Kohlberg
Kravis
Roberts, The Blackstone Group and Warburg Pincus

The project also includes the understanding of the Private Equity model
of investments
and analyzing the reason for investments in selective sectors. With India
becoming a
preferred investment destination, this heightened level of private equity
activity is
likely to continue for some time to come.

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PRIVATE EQUITY IN INDIA 

OBJECTIVE

The objective of this project is to study the role of private equity in

India, analyzing
their investment strategies, their particular strategies, by studying
their entry strategies
into India financial markets, regulatory norms in India and how it is
beneficial of Indian
companies. An attempt will also be made to understand their investment
patterns.

The project would also deal with some of the major deals in India, this
would help to
understand the investment pattern and than the exit strategies of the PE
firms.

The project would also help to understand us what could be the scenario
of the private
equity investments in the near future, and comparison of the Indian
scenario with rest
of the world.

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PRIVATE EQUITY IN INDIA 

Definition

The Private Equity sector is broadly defined as investing in a company

through a
negotiated process. Investments typically involve a transformational,
value-added,
active management strategy. Typical forms of private equity include
venture capital,
growth and mezzanine capital, angel investing and private equity funds.
Private equity
investors seek to obtain a substantial interest in a company in order to
have an active
role in firms’ strategic decisions. Their goal is to boost the value of a
company and walk
away with substantially more money at the time of liquidating their
investment.

Private equity consists of investors and funds that make investments

directly into
private companies or conduct buyouts of public companies. Capital for
private equity is
raised from institutional investors and can be used to fund new
technologies, expand
working capital within an owned company, make acquisitions, or to
strengthen a
balance sheet.

The term "private equity" encompasses a range of techniques used to

finance
commercial ventures in ways that do not involve the use of publicly
tradable assets
such as corporate stock or bonds.

Private Equity Funds: Private equity funds are investment companies that,
as a rule, do
not trade in publicly-traded securities. Instead, they normally seek
equity stakes (that is,
partial ownership) in private companies. They may also invest in so-
called private
placements of securities from public companies. Private equity buyers are
extremely
focused on cash-flow and have a reputation as cost-cutters.

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Private Equity: Current Scenario

India has a very vibrant Venture Capital (VC) / Private Equity (PE)
industry with USD
32.5 billion invested across more than 1500 VC/PE deals from January 2006
till date.

Economists estimate that India needs about USD 1 trillion of investment

over the next
five years to sustain a GDP growth of above 9 percent. This translates to
USD 60-100
billion of VC/PE investments requirement over three years, against which
industry
estimates that PE investments would be in the range of USD 9-10 billion
in the year
ending December 31, 2010.

After a turbulent 2009, private equity investments in India displayed

steady signs of
recovery in the first quarter of 2010. The latest quarter registered the
highest value of
deals since 2009.

For the quarter ended March 2010, total announced deal value was $1,943
mn, a jump of
more than 185% from $675 mn in Q1 2009. Total deal count in Q1 2010 also
increased by
35% to 88 deals, up from 65 in Q1 2009. Interestingly, despite the
enormous growth in
deal value on a quarter-on-quarter basis, the deal count decreased by 11%
to 88, down
from 99 in Q4 2009.

2005 2006
2007
Year
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Q1 Q2 Q3 Q4
Value (in $mn) 442 379 716 691 1,246 2,605 1,526 1,697
2,555 2,734 5,508 5,184
Volume 66 44 45 65 114 93 81 100
166 88 105 149

2008 2009
2010
Year
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Q1
Value (in $mn) 5229 2065 3345 1604 675 1138 1178 1413
1943
Volume 190 113 133 84 65 62 73 99
88

(Source: VCCEdge)

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(Source: VCCEdge)

(Source: VCCEdge)

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SECTORAL BREAKDOWN

Top Sectors by Deal Value for the year 2009 ($mn)

(Source:
VCCEdge)

Real estate, IT/IT Services and Energy were the most targeted sectors for
investment
with deals worth $0.65 billion, $0.62 billion and $0.54 billion
respectively. Together, they
accounted for more than 40% of total private equity deal value during the
year 2009.

Top Sectors deals in 2009

Sector Volume Deal Value ($mn) Average Deal

Size

Real Estate 20 657

43.8
IT/IT Services 47 621
15.9
Energy 16 538
41.4
Logistics 15 354
23.6
Telecom 5 336
84
Banking, Finance & 32 244
8.4
Insurance
Manufacturing 34 242
9.3
(Source:
VCCEdge)

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The major PE investments influencing the deal values of these sectors

were investments
in Aricent Inc., Indiabulls Real Estate Ltd., Mohtisham Estates and Ind
Barath Power
Infra Pvt. Ltd. The other sectors, which have significantly contributed
to private equity
deal value in the year 2009, are Logistics and Telecom accounting for 15%
of total deal
value.

Top Sectors by Deal Volume for the year 2009

(Source:
VCCEdge)

The most active sectors in terms of deal volume were IT/IT Services and
Manufacturing
which lead with 17% and 11% of deal volume respectively in 2009. Other
sectors
contributing significantly to deal volume were Banking, Finance and
Insurance and
Real estate accounting for 11% and 7% of deal volumes respectively. As
seen in the year
2008, 2009 too saw large number of deals in IT/IT Services,
Manufacturing, Banking,
Finance and Insurance and Real estate.

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Types of Private Equity

Private Equity investments can be divided into the following categories:

1. Leveraged Buyout

Leveraged buyouts involve a financial sponsor agreeing to an acquisition

without itself
committing all the capital required for the acquisition. To do this, the
financial sponsor
will raise acquisition debt which ultimately looks to the cash flows of
the acquisition
target to make interest and principal payments. Acquisition debt in an
LBO is
often non-recourse to the financial sponsor and has no claim on other
investment
managed by the financial sponsor. Therefore, an LBO transaction's
financial structure is
particularly attractive to a fund's limited partners, allowing them the
benefits of
leverage but greatly limiting the degree of recourse of that leverage.

2. Venture capital
Venture capital is a broad subcategory of private equity that refers to
equity
investments made, typically in less mature companies, for the launch,
early
development, or expansion of a business. Venture investment is most often
found in the
application of new technology, new marketing concepts and new products
that have yet
to be proven.
Venture capital is often sub-divided by the stage of development of the
company
ranging from early stage capital used for the launch of start-up
companies to late stage
and growth capital that is often used to fund expansion of existing
business that are
generating revenue but may not yet be profitable or generating cash flow
to fund future
growth.
Entrepreneurs often develop products and ideas that require substantial
capital during
the formative stages of their companies' life cycles. Many entrepreneurs
do not have
sufficient funds to finance projects themselves, and they prefer outside
financing. To
compensate the risk of failure, venture capitalist's seeks higher return
from these
investments. Venture Capital is often most closely associated with fast-
growing technology and biotechnology fields.

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3 .Growth capital
Growth capital refers to equity investments, most often significant
minority
investments, in relatively mature companies that are looking for capital
to expand or
restructure operations, enter new markets or finance a major acquisition
without a
change of control of the business.
Companies that seek growth capital will often do so in order to finance a
transformational event in their life cycle. These companies are likely to
be more mature
than venture capital funded companies, able to generate revenue and
operating profits
but unable to generate sufficient cash to fund major expansions,
acquisitions or other
investments. The primary owner of the company may not be willing to take
the
financial risk alone. By selling part of the company to private equity,
the owner can take
out some value and share the risk of growth with partners.

4 .Distressed and Special Situations

Distressed or Special Situations are a broad category referring to
investments in equity
or debt securities of financially stressed companies. The "distressed"
category
encompasses two broad sub-strategies including:

ƒ "Distressed-to-Control" or "Loan-to-Own" strategies where the

investor acquires
debt securities in the hopes of emerging from a corporate
restructuring in control of
the company's equity;
ƒ "Special Situations" or "Turnaround" strategies where an investor
will provide
debt and equity investments, often "rescue financing" to companies
undergoing
operational or financial challenges.

5 .Mezzanine capital

Mezzanine capital refers to subordinated debt or preferred equity

securities that often
represent the most junior portion of a company's capital structure that
is senior to the
company's common equity. This form of financing is often used by private
equity
investors to reduce the amount of equity capital required to finance a
leveraged buyout
or major expansion. Mezzanine capital, which is often used by smaller
companies that
are unable to access the high yield market, allows such companies to
borrow additional
capital beyond the levels that traditional lenders are willing to provide
through bank

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loans. In compensation for the increased risk, mezzanine debt holders

require a higher
return for their investment than secured or other more senior lenders.

6. Secondaries

Secondary investments refer to investments made in existing private

equity assets.
These transactions can involve the sale of private equity fund interests
or portfolios of
direct investments in privately held companies through the purchase of
these
investments from existing institutional investors. By its nature, the
private equity asset
class is illiquid, intended to be a long-term investment for buy-and-hold
investors.
Secondary investments provide institutional investors with the ability to
improve
vintage diversification, particularly for investors that are new to the
asset class.
Secondaries also typically experience a different cash flow profile,
diminishing
the effect of investing in new private equity funds. Often investments in
secondaries are
made through third party fund vehicle, structured similar to a fund of
funds although
many large institutional investors have purchased private equity fund
interests through
secondary transactions. Sellers of private equity fund investments sell
not only the
investments in the fund but also their remaining unfunded commitments to
the funds.

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The Stages of Private Equity

Private Equity investments can be classified into:

• Seed stage Financing provided to research, assess and develop an

initial concept
before a business has reached the start-up phase

• Start-up stage financing for product development and initial

marketing.

• Expansion stage financing for growth and expansion of a company

which is
breaking even or trading profitably.

• Replacement capital Purchase of shares from another investor or

to reduce
gearing via the refinancing of debt.

The above stages can be explained by the diagram which is shown below -:

The Stages of Private Equity

Liquidity
Expansion event
capital

Follow-on
Buyouts
Bridge/
venture
mezzanine
financing

Seed/start up

[Reengineering

restructuring]

[Later stage]

[Development stage]

[Concept stage]
(Source: private-equityonline.com)
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Process of Private Equity Investment

The Private Equity Process in 6 Steps:

1. Deal Origination (Deal Sourcing)

2. Due Diligence
3. Deal Negotiation
4. Deal Closing (Acquisition)
5. Post Acquisition Monitoring
6. Exit (IPO, Trade Sale or Buy back)

Deal Origination or as some call it ‘Deal Sourcing’ is how Deal Makers

get their deals, a
potential deal can either come through a company owner approaching them
or from an
intermediary who will try to bring both parties (Company and Deal Maker)
to make the
deal. In some cases, they may just approach companies who are expanding
fast and
wish to grow further. In a year, Deal Makers come across hundreds of
potential deals -
but only a few are selected.

Due Diligence is what you could call ‘doing your homework’. Before
starting detailed
negotiations, investor try to make sure everything is fair and secure.
Although Auditors
and Consultants are appointed to conduct the Financial, Tax, Legal and
Technical Due
Diligence - they also work side by side to understand the target company
and its
industry better. All the information collected at this time, is then used
during
negotiation.

At the Deal Negotiation phase, investor set out the terms and conditions
(covenants,
representations and warranties) and other deal terms that defines (or
makes the deal).
Contracts such as Investment Agreement, Share Purchase Agreement,
Management
Agreement, Advisory Agreement etc are drafted to include all items that
put the deal
together.

Deal Closing is probably the easiest part but also contains an element of
risk. It’s the
conclusion of the deal, the signing of all Agreements and transferring
funds from the
buyer to seller, conducting other administrative functions (usually done
by a separate
entity) like updating any articles of association etc.

Post Acquisition Monitoring requires the Deal Team (those who have worked
on
putting the deal together) to closely monitor the company, both from an
operational
and financial point of view against the expansion plan and budgets that
were setup

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PRIVATE EQUITY IN INDIA 

earlier by the company. Improvements to business, from Corporate

Governance,
Financial Reporting, and Information Flow to Strategy are made at each
level through
either the company’s management or its board.

As the company matures (usually after 2 - 4 years) with the presence of

the Deal Team,
investor prepare it for an Exit - either an IPO or a Trade Sale (sale to
a larger party,
multi-national or conglomerate) or in rare cases a Buy Back by the
owners. By this time,
the company will have grown quite a bit with still plenty of room to grow
further.
(There’s a saying, in a deal - always leave something extra for the
person buying - it
makes everyone happy.)

And once investor have exited the company, they return their money with
the profit
they gained for company after taking their fees for all the effort put in
the above
process.

Although this may seem like a linear process - it isn’t exactly so,
primarily because
investors deal with a number of companies and each one is at a different
stage in the
private equity process.

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PRIVATE EQUITY IN INDIA 

Advantages of Private Equity

Investing in a private equity fund has a lot of advantages compared to

other investment
areas; here are some advantages of private equity for not only investors
but also the
companies that private equity firms acquire:

Advantages for Investors:

¾ By definition, private equity firms work outside the public eye and
do not have
to follow the same transparency standards that public firms and
funds must
adhere to. This allows private equity firms to reform the companies
without the
constraint of having to report quarterly to the SEBI, ROC or similar
distractions.
¾ Private equity firms generally perform very rigorous due diligence
on potential
investments. By utilizing a team of researchers the private equity
firm is able to
identify most risks that would not otherwise be found.
¾ The management receives carried interest, a portion of the profits,
so managers
and their staff are motivated to produce good results to investors.
Although
carried interest is often criticized for taking money from the
investors, it is a very
big incentive for managers.

¾ Economic Scenario- India is one of the fastest growing economies in

the world,
with enormous growth potential in many industries. This means that
capital
requirements are high, translating into an ideal hunting ground for
PE funds .

¾ Abundance of skilled labor - India offers a huge advantage in the

form of its
highly talented and skilled labor pool, which can lead to the
success of the firms
in which investment is made through the private equity route. The
funds are not
just bullish about the businesses in India but have also grabbed a
fair share of
highly rated managers like Vivek Paul, Rajeev Gupta, Avnish Bajaj,
Akhil
 Gupta, and Nikhil Khattau. PE funds are invariably on the lookout
for high
profile managers, not only to manage their own funds but also as
their
representative on the board of companies in which they have
invested.

¾ Success of several sectors - India has firmly established itself as

the world’s IT
superpower with almost all major software development companies
having an
Indian development centre. It is also becoming the the hub of back
office
operations, and a leading provider of BPO and KPO services. This has
led to
greater confidence in the future growth potential of Indian
companies.

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PRIVATE EQUITY IN INDIA 

¾ Mature Financial markets - Capital markets have stabilized in the

recent past
with regulators like SEBI keeping a firm watch on the market
development. This
means both increased opportunities as well as an easier and painless
exit route
for PE funds. The emergence of entrepreneurs in India who consider PE
their full
time occupation is also a positive sign. Besides, there are well
established
corporate houses diversifying their surplus investment, as a strategy
for their
assets allocation, through PE funds without involving themselves
directly in the
operations of target companies.

¾ Successful M&As- A recent spate of mergers and acquisitions has given

rise to
yet another way of exiting from Indian companies for private equity
investors.

¾ Successful track record - The first generation of private equity

players have realized significant success in the last several years.
For instance,
Warburg Pincus earned huge returns out from its investments in Indian
companies like Bharti Telecom.

Advantages for Company:

¾ Private equity managers are paid very well and so it is easy to

attract high
caliber, experienced managers that tend to perform very well. The
same goes for
lower level employees at private equity firms, they tend to be the
top young
business school graduates. This helps the company to utilize best
talent in the
industry without shelling out even a single penny from its pocket.

¾ PE helps a company to prepare for stock market listing (IPO) as the

exit route of
investment. It opens up enormous opportunities for companies to raise
funds.
The continuous scrutiny by stock market participants, SEBI & ROC
facilitates
efficiency improvement and proper strategic decisions.

¾ PE helps those companies which cannot raise money from the market. By
private
 equity company get money from the investors, which help in the growth
of the
company.

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Disadvantages of Private Equity

Disadvantages for Investors:

¾ Difficult to access for small & medium investors- private equity

Limited
Partnership funds may only be marketed to institutions and very
wealthy
individuals; in addition the minimum investment accepted is usually
more than
£1mn.

¾ Relative illiquidity –Private Equity funds normally invest in a

unlisted space
and they find it difficult to exit the investment at their wish,
since it require
concentrated efforts to find a suitable investor for unlisted
company. Even in the
listed space, the impact cost remains very high due to sheer
magnitude of scale.

¾ A long term investment perspective is necessary to achieve gains for

a private
equity investment programme because the investment programme depends
on
the company growth. It depends on the gap between entry and exit of
the
investor.

¾ Political condition - India, being divided into a number of states,

causes an
investment decision to be affected by politics. Changes in regulation
and
infrastructure development are often sidelined due to friction and
conflict
between the state and the federal government.

¾ Competition from China - China is a direct competitor of India and

most of the
private equity investors, eyeing the Asian region, draw a comparison
across both
the countries to decide where their money should be parked. The new
state-of-
the-art airports in China bear a stark contrast to the abysmal
conditions of the
terminals in India’s main cities.
 ¾ High costs - private equity managers charge relatively high fees for
managing
capital committed by external investors (generally around 2%) and, if
the fund
performs well, take a sizeable proportion (generally 20%) of realised
returns in
excess of investment hurdle rates.

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Disadvantages for Company:

¾ It is a lengthy process since private equity managers conduct

detailed market,
financial, legal, environmental and management due diligence, which
could take
several months before they make final decisions on investing.

¾ Entrepreneurs have to give up some of their company’s shares to a

private equity
investor, i.e. control. Because investor have some control over the
company, so it
is not easy for the entrepreneur to take decision independently. He
have to take
advice of the investor to take decision and it causes delay in the
process.

¾ The private equity managers have control over the timing of a sale of
(a part of)
the business.

¾ Lack of promotion in investment across sectors - PE funds are

being channelized into only a few sectors like IT, infrastructure &
real estate and
telecommunications, to the exclusion of the remaining industries,
desperately in
need of funds for growth.

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Ways of Investment

There are two types of listed private equity investment companies - those
which invest
directly in companies and those that invest in funds which invest in
companies (fund of
funds). Some private equity investment companies invest in both direct
investments
and funds offering a hybrid of the two approaches set out below.

Direct investors
The investment company has a private equity team who invest directly in
companies,
subject to the stated objective of the company. The managers’ aim is to
help these
companies develop and progress, and sometimes restructure, in order to
increase the
long-term value of the companies so these companies can be sold at a
profit.

Fund of funds investors

In a fund of funds, the investment company invests in a portfolio of
private equity
funds which invest in companies. Funds of funds aim to diversify across a
range of
investment strategies and different sectors providing access to a range
of managers.

Investing in PE Funds

Direct Investment

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Top 10 Private Equity Deals

• The top 10 private equity deals accounted for more than 36% of
total private
equity deals in 2009. In 2008, top 10 deals accounted for about
40% of total deal
value for the year

• The largest deal by value was KKR’s $255 mn buyout of Aricent,

followed by
Siva Ventures investment in S Tel Ltd. and TPG’s $200 mn
investment in
Indiabulls Real Estate.

• Top deals occurred across various sectors, with 3 of the top 10

deals in Real
Estate.

Top Private Equity deals in 2009

S. NO. Industry Target Buyer

Price ($mn)
1 IT/IT Services Aricent Inc. Kohlberg Kravis Roberts
& Co. 255
2 Telecom S Tel Ltd. Siva Ventures Ltd.
230
3 Real Estate Indiabulls Real TPG Capital Inc.
200
Estate Ltd.
4 Logistics Krishnapatnam 3i India Infrastructure
Fund 161
Port Co. Ltd.
5 Real Estate Mohtisham Estates Oman Investment Fund
125
6 Agriculture Karuturi Global Emerging India Focus
Funds, 124
Ltd. India Focus Cardinal
Fund, Elara
India Opportunities
Fund,
Monsoon India Inflection
Fund
Ltd.
7 Hospitality & Capricon New Silk Route Partners
124
Travel Hospitality Services
Pvt. Ltd.
 8 Healthcare & Max India Goldman Sachs
115
Services
9 Real Estate Century Real Goldman Sachs Whitehall
Real 104
Estate, Seven Star Estate Fund
Hotel Project
10 Energy Ind-Barath Power Bessemer Venture
Partners India, 100
Infra Pvt. Ltd. Citi Venture Capital
International,
Sequoia Capital India

(Source: VCCEdge)

Page 23 
PRIVATE EQUITY IN INDIA 

Ways of Exit

There are different ways in which a private equity investor can exit from
an investment:

A. Trade sale
A trade sale, also referred to as M&A (Mergers & Acquisitions), of
privately held
company equity is the most popular type of exit strategy and refers to
the sale of
company shares to industrial investors.
The trade sale is agreed in private and makes both the buyer and the
seller less
vulnerable to the external pressures of a stock market flotation. It is
often advisable to
keep the transaction a closely guarded secret because clients, suppliers
and employees
may interpret a trade sale negatively. These negative signals become even
stronger if
the negotiations fail.

B. Entrepreneur or Management Buy-Out

The Buy-Out of the funds stake by its management team is becoming more
and more
successful as an exit strategy. It is a very attractive exit for both the
investment manager
and the company’s management team if the company can guarantee regular
cash flows
and can mobilize sufficient loans. The accounting and financial aspects
of this exit need
to be studied very carefully.

C. Sale of the investment to another financial purchaser (called a

secondary market investor)
One financial investor may sell his equity stake to another one when the
company has
reached the stage of development or when the current development of the
company no
longer corresponds to the investment criteria of the original fund. This
can also occur if
the financial support required maintaining the company’s development has
exceeded
the capacity of the fund. This strategy has the advantage of enabling an
exit when the
team does not want a trade sale or a stock market flotation.
D. IPO (Initial Public Offering): flotation on a public stock market
A stock market flotation may be the most spectacular exit, but it is far
from being the
most widely used, even in stock market booms.

Page 24 
PRIVATE EQUITY IN INDIA 

A stock market flotation should correspond with a genuine wish to make

the company
more dynamic over the long term and to profit from the growth
possibilities offered by
a stock market. Therefore, the equity share placed on the market (the
float) must be
sufficiently large to ensure liquidity – the reward for appealing to the
market. A
flotation is not an end in itself but the beginning of a long process of
development.
A stock market flotation always leaves company open to the risk of an
unwanted bid
whereas equity held by an investor that company has chosen can be better
managed. If
company decides to opt for this route, it must be minutely prepared over
a long period.

E. Liquidation
This is obviously the least favorable option and occurs when the efforts
of the head of
the company and the investors to save the company have not succeeded.

Top Private Equity Exits in 2009

S. NO. Target Seller Type

Price ($ mn)
1 DLF Assets Pvt. Ltd. DE Shaw Composite Buyback
470
Investments (Mauritius) Ltd.
2 ICICI Bank Ltd. Temasek Holdings Pte. Ltd., GIC Open
Market 460
Special Investment Pte. Ltd.
3 Shriram Transport ChrysCapital lll LLC Open
Market 221
Finance Co. Ltd.
4 XCEL Telecom Pvt. Q Investments LP M&A
150
Ltd.
5 Cognizant Sequoia Capital India Open
Market 60
Technology Solution
Corp.
6 Edelweiss Capital Galleon Special Opportunities Open
Market 54.93
Ltd. Master Fund SPC Ltd.
7 India Infoline Ltd. Orient Global Tamarind Fund Open
Market 51.9
Pte Ltd, Orient Global
Cinnamon Capital Ltd.
 8 Max India Ltd. Warburg Pincus India Pvt. Ltd. Open
Market 50.5
9 Financial Software Carlyle Asia Venture Partners l
Secondary 51
& System Pvt. Ltd. Sales
10 Mindtree Ltd. Capital International Global Open
Market 47
Emerging Markets Private
Equity Fund LP.

(Source: VCCEdge)

Page 25 
PRIVATE EQUITY IN INDIA 

Private Equity Exits Breakdown

• 2009 saw 96 exits compared to 44 in 2008 not including the PE stake

sale in
Centurion Bank of Punjab to HDFC Bank. Total exit value rose to
$2.2 billion in
2009 compared to $0.93 billion in 2008.

• Funds utilized the sharp rise in the stock markets to cash out and
return some
money to LP’s. There were 66 open market exits and only one IPO
exit – the part
sale of Warburg Pincus’ stake in DB Corp.

(Source:
VCCEdge)

Page 26 
 Major Private Equity Deals in
India

Curren
Investm
Entry Exit t Value Profit /
Investor Company Year ent Type
Stage Route Route of Loss
Size
Invest

ment
Warburg Bharti-Tele 1999-2001 $ 292 mn Venture
Start up Direct Open _______ $ 1.324
Pincus Ventures Capital
Market, bn

Seconda

ry Sale
KKR Dalmia Cement 2010 $ 150 mn Growth
Expansion Direct Still Unlisted _______
Capital
Invested
ICICI Air Deccan 2004 $ 70 mn Venture
Start up / Fund * * *
Venture, Capital
Expansion Of
Capital
Funds
International
Actis Paras 2006 $ 42 mn Growth
Expansion Direct Still Unlisted _______
Pharmaceuticals Capital
Invested
TPG Shriram 2006 $ 100 mn Growth
Expansion Fund Still Unlisted _______
Transport Capital
Of Invested
Finance
Funds
Blackstone Gokaldas 2007 $ 165 mn Secondaries
Replacement Direct Still INR _______
Exports Ltd.
Invested 3595.49

mn

* Air Deccan has been merged into Kingfisher Airlines by late 2008.
 Warburg Pincus & Bharti Airtel Ltd.
About Bharti Airtel Ltd.
Bharti Airtel provides telecommunication services primarily to retail,
corporate, and
small and medium scale enterprises in India. It offers global system for
mobile
communication (GSM) services, broadband and telephone services, national
and
international long distance services, and enterprise services.

The company's mobile communication services include information services,

short
message, and prepaid and post paid services, as well as wireless
application protocol-
enabled Internet access and roaming services. Its telephone services
include telephone
services, dial-up services, special phone plus services, unified
messaging, and audio
conference services; and broadband services comprise integrated services
digital
network, leased line, virtual private networks, and wireless fidelity
networks.

The company also offers long-distance voice and data communication

services, as well
as enterprise services, such as voice services, mobile services,
satellite services, managed
data and Internet services, and managed e-business services.

As of Mar. 31, 2009, it provided telecommunications services to

approximately
96,649,000 customers, consisting of GSM mobile, broadband and telephone
customers.

Bharti Airtel had strategic alliances with SingTel and Vodafone;

partnerships with
Ericsson and Nokia; and an information technology alliance with IBM. The
company
was founded in 1995. It was formerly known as Bharti Tele-Ventures and
changed its
name to Bharti Airtel in April, 2006. The company is based in New Delhi,
India. Bharti
Airtel is a part of Bharti Enterprises.

Between September 1999 and July 2001, Warburg Pincus invested $292 mn to
finance
Bharti's growth through acquisition and expansion of existing properties.
Since the
initial investment in Bharti in September 1999, it has become the largest
private sector
telecom company in India and has undergone a number of changes.

First, the company has formulated a focused acquisition strategy,

acquired three
companies and successfully won bids for 15 new licenses. Second, all the
key support
functions and processes (like human resources, finances, marketing and
technology)
PRIVATE EQUITY IN INDIA 

have been strengthened, with experienced professionals heading these

functions. Lastly,
in spite of tough market conditions, the company made a successful
initial public
offering on the Indian stock exchanges in February 2002 and raised $172
mn.

Top 10 Shareholders
S. No. Holders
%
1. Bharti Telecom Limited
45.30
2. Pastel Limited
15.58
3. Indian Continent Investment Limited
6.27
4. Life Insurance Corporation of India
4.23
5. Europacific Growth Fund
1.68
6. Fidelity Management and Research and Funds
1.26
7. Copthall Mauritius Investment Limited
0.97
8. JP Morgan Asset Management and Funds
0.98
9. ICICI Prudential
0.82
10. Emerging Markets Fund
0.73
Total
77.82
(Source: Bharti Airtel
Annual Report 2008-2009)

International Footprints
Its area of operations includes:

3 countries in the Indian Subcontinent: Bangladesh, India and Sri Lanka

Bangladesh- In March 2010, Bharti agreed to buy 70 percent of

Bangladesh's Warid
Telecom from Abu Dhabi Group for an initial investment of US $300
million.

India- In India, the company's mobile service is branded as Airtel. It

has nationwide
presence and is the market leader with a market share of 30.07% (as of
May 2010).

Sri Lanka- In December 2008, Bharti Airtel rolled out 3.5G services in
Sri Lanka in
association with Singapore Telecommunications. Airtel's operation in Sri
Lanka, known
as Airtel Lanka, commenced operations on the 12th of January 2009.

15 countries in Africa:

Burkina Faso, Chad, Democratic Republic of the Congo, Republic of the

Congo, Gabon,
Ghana, Kenya, Madagascar, Malawi, Niger, Nigeria, Sierra Leone, Tanzania,
Uganda
and Zambia

Page 29 
PRIVATE EQUITY IN INDIA 

About Zain

Zain is a leading telecommunications operator across the Middle East

providing mobile
voice and data services to over 31.4 million active customers as at 31
March 2010 with a
commercial presence in 8 countries. Zain is listed on the Kuwait Stock
Exchange. Zain
operates in the following countries: Bahrain, Iraq, Jordan, Kuwait, Saudi
Arabia and
Sudan. In Lebanon, the company manages ‘mtc-touch’ on behalf of the
government. In
Morocco, Zain has a stake in Wana Telecom through a joint venture.

Zain-Bharti Deal

Zain, with its African and Middle East businesses, had been considered a
natural target
for Bharti, which has thrived in an Indian market with low incomes and
tariffs and a
heavily rural population -- characteristics shared by African nations.

Mobile phone penetration in half of Africa's countries was below 40

percent as of
August and a dozen countries had penetration below 30 percent, according
to a
research report.

Offloading the operations, excluding those in Morocco and Sudan, would

mark a
strategic reversal for Zain, which has spent more than US $12 billion
expanding in
Africa since 2005.

This transaction has resulted in aggregate net cash proceeds of US $8.968

billion. Zain
confirms that it has received US $7.868 billion of cash proceeds from
Bharti.

Over the next 6 months, Zain expects to receive up to an additional US

$400 million
upon certain milestones being achieved. The balance of US $700 million is
due one year
from completion as per the original agreements signed on 30th March 2010.

Page 30 
PRIVATE EQUITY IN INDIA 

About Warburg Pincus

Over the last 30 years, Warburg Pincus has become one of the leading
private equity
and venture capital firms in the world. The firm’s experience is
unparalleled in
building successful businesses. Working in partnership with management
teams,
Warburg Pincus takes an active role in building businesses. The firm
operates globally
to source new investment opportunities, provide strategic advice and
guidance, and
fund the growth of attractive opportunities, since its inception, Warburg
Pincus’
strategy has been to:

• Develop broad investment capabilities internally.

• Create a network of talented and experienced business people

around the world.
• Provide superior rates to return for its limited partners over the
long
term.

Warburg Pincus is a global leader in the industry it helped create:

Private equity. With
more than 40 years of experience, its track record of continuous and
successful investing
is unmatched by any other private equity firm.

Striving to create sustainable value in partnership with superior

management teams, it
work with companies to formulate strategy, conceptualize and implement
creative
financing structures, recruit talented executives and draw on best
practices from the
firm’s portfolio companies.

It takes a different approach to investing, beginning with a thorough

evaluation of
macroeconomic and industry fundamentals. Private equity at Warburg Pincus
means
investing at all stages of a company’s life-cycle: From founding start-
ups and fostering
growth in developing companies to leading complex recapitalizations or
large-scale
buy-outs of more mature businesses. This growth-oriented philosophy is
incorporated
across each of its investment sectors. With an investment horizon of five
to seven years,
it takes an unusually long-term perspective. Matched with its size and
scope of funds
under management, this approach enables the firm to provide substantial
resources to
its portfolio companies. This is a critical advantage in the face of
constantly changing
economic conditions and financial markets.

Page 31 
PRIVATE EQUITY IN INDIA 

The firm has been industry-focused for more than two decades. With more
than 160
investment professionals worldwide, Warburg Pincus provides deep
expertise in a
range of investment sectors including financial services, healthcare,
industrial,
technology, media and telecommunications, energy, consumer and retail and
real
estate.

The firm also works with its consultants, entrepreneurs-in-residence and

advisory
boards, whose expertise can be tapped at any time.

In addition to the support provided by its investment professionals,

Warburg Pincus
enhances its involvement with management by providing portfolio companies
with
value-added services in capital markets, IT strategy and assessment and
marketing.

Warburg Pincus has been the lead investor in more than 100 companies that
have
completed initial public offerings. Over the last few years, the firm’s
global portfolio has
generated more than $20 billion annually in equity and debt financings on
a global
basis. The firm’s IT Strategy and Assessment group is available to
evaluate and advise
businesses on their technology strategy. Warburg Pincus also provides
companies with
marketing expertise to develop brand-building programs and strategic
communications
platforms for internal and external audiences.

Key-Points:

¾ It has invested over US $ 11 billion in over 400 companies in 29

countries,
providing equity capital across the life cycle of the enterprise,
from start-up
through growth financings and including acquisitions and
restructurings.
¾ Warburg Pincus operates from 8 offices in 7 countries covering the
United States,
Europe, Asia and Latin America.
¾ With the proposed investment, Warburg Pincus will have invested
approximately US $ 530 mn in India making the country, the firm’s
premier
investment destination in Asia.
¾ The investment in Bharti Enterprises of approx. US $ 300 mn is the
second
 highest investment ever made by Warburg Pincus in any company,
anywhere in
the world.

Page 32 
PRIVATE EQUITY IN INDIA 

The Deal
The Investment (1999-2001)
Between September 1999 and July 2001, Warburg Pincus invests $292 mn in
Bharti Tele-
Ventures in return for an 18.58 per cent stake, the first tranche being
invested in
September 1999.

The Bharti IPO (January 2002)

Bharti goes public (Warburg stake diluted)

The other exits (2004-2005)

• August 2004: Warburg sells a 3.35 per cent stake for about $208
mn.

• March 2005: Warburg sells another 6 per cent stake for $560 mn,
marking the
largest ever equity deals in single scrip on an Indian stock
exchange.

• October 2005: Warburg sells its final 5.65% stake to UK-based

Vodafone for
$847.5 mn.

This is the timeline of Warburg Pincus' exit from Bharti Tele-Ventures.

Total realization: $1.616 bn.

Profit: $1.324 bn - 450 per cent return on investment.

Page 33 
PRIVATE EQUITY IN INDIA 

Opportunities viewed by Warburg Pincus

The deal with Bharti Tele Ventures Ltd. had a lot of opportunities for
Warburg Pincus.

• National Telecom Policy encouraging

™ Domestic Private Investment

™ Foreign Direct Investment

• Competition to Fixed Line Service Providers

™ High Installation Fees

™ Order Backlog

• Mobile Telephony considered as a status symbol

• Markets were Price Elastic

• No Player having Pan-India presence

• Telecommunication is a pre-requisite for Growth

Challenges faced by Warburg Pincus

• Lack of Regulatory Clarity

• Economic viability of Telecommunication Project

• Restriction on Licenses

• Monthly Fixed License fee to government

• High tariff charges-Expensive for users

• No investor interest – No clarity on Exit route

• Bharti having presence only in North India

Page 34 
PRIVATE EQUITY IN INDIA 

Strengths and Opportunities of Airtel

Strengths

• Bharti Airtel has more than 200 million customers (June, 2010). It
is the largest
cellular provider in India and among top 5 in the world and also
supplies
broadband and telephone services - as well as many other
telecommunications
services to both domestic and corporate customers.
• Today they are among the top 5 largest Wireless & Cellular Company
in world, with
expanded footprints of over 25 countries in two of the largest
continents spread over
South Asia and Africa. Bharti Airtel has strategic alliances with
Nokia, Sing Tel
and a host of all other international service providers. They have
access to
Emerging Africa, which means that they can replicate their Indian
business
strategy and knowledge to other parts of the world.

Opportunities

• The Rural Landscape

The Indian telecom industry is the 2nd largest wireless markets in

the world after
china. The focus on rural penetration and customer affordability
will be
instrumental in driving the next phase of growth in India. An
increasing number
of rural customers are contributing to the growth in telecom
sector.

• New technologies and paradigms

New technologies also play vital role in growth of telecom sector.

Technologies
like HSPA, WiMAX and Wi-Fi has already adopted by customers. 3G
and BWA
auction are in the process currently. Besides this DTH and IPTV
technologies are
viewed as long term perspective by telecom operators.
 • Strong strategic partnership

Page 35 
PRIVATE EQUITY IN INDIA 

Airtel have a strategic alliance with SingTel, Ericsson, Nokia and

IBM. The
partnership with SingTel was to provide quality service to the
customers.
Partnership with Ericsson and Nokia was for providing better
equipments. IBM
has been working closely with Airtel to transform its IT system.

PE Impact on Bharti
The deal of Warburg Pincus & Bharti Tele ended not only with the increase
in profit for
WP, but also high growth in subscribers of Bharti Tele Ventures.

In partnership with Warburg Pincus, Bharti’s management team was able to

complete
additional cellular property acquisitions and extend its leading position
in India. Today
they are among the top 5 largest Wireless & Cellular Company in world,
with expanded
footprints of over 25 countries in two of the largest continents spread
over South Asia
and Africa.

WP also worked with management to secure a strategic partnership with

Singapore
Telecom, which subsequently committed support in the management of the
operations.
The company was listed on Indian stock exchanges in February 2002. Now
known as
Bharti Airtel, the company has a market capitalization in excess of $35
billion and is a
dominant player in the Emerging Markets telecommunications with a
customer base of
more than 200 million (including operations in Africa and other South
Asian countries).

“Partnership with Warburg Pincus helps management focus. They’ve helped

us look at things in
a different light. And, they know how to move a company from something
small to something
much larger…”

Sunil Mittal, Chairman and Group

Managing Director
Page 36 
PRIVATE EQUITY IN INDIA 

(Source: Bharti Airtel Annual Report 2008-

2009)

Page 37 
PRIVATE EQUITY IN INDIA 

(Source: Bharti Airtel Annual Report 2008-

2009)

(Source: Bharti Airtel Annual Report 2008-

2009)

Page 38 
PRIVATE EQUITY IN INDIA 

(Source: Bharti Airtel Annual Report 2008-

2009)

(Source: Bharti Airtel Annual Report 2008-

2009)

Page 39 
PRIVATE EQUITY IN INDIA 

Dalmia Cement - KKR

About KKR

Founded in 1976 and led by Henry Kravis and George Roberts, KKR is a
leading global
alternative asset manager with $52.2 billion in assets under management
as of
December 31, 2009. With over 600 people and 14 offices around the world,
KKR
manages assets through a variety of investment funds and accounts
covering multiple
asset classes. KKR seeks to create value by bringing operational
expertise to its portfolio
companies and through active oversight and monitoring of its investments.
KKR
complements its investment expertise and strengthens interactions with
investors
through its client relationships and capital markets platforms. KKR is
publicly traded
through KKR & Co. (Guernsey) L.P. (Euro next Amsterdam: KKR).

KKR has invested more than over $1.1 billion in India since 2006, which
includes
investments in Aricent, a global innovation, technology and services
company; Bharti
Infratel, a telecom infrastructure provider and Coffee Day Resorts,
operator of the Café
Coffee Day chain of cafes in India.

About Dalmia Cement (Bharat) Ltd

DCBL has business interests in two major segments, Cement and Sugar. It
has cement
plants in southern states of Tamil Nadu (Dalmiapuram & Ariyalur) and
Andhra
Pradesh (Kadapa), with a capacity of 9MTPA. A leader in cement
manufacturing since
1939, DCBL is a multi spectrum cement player with double digit market
share and a
pioneer in super specialty cements used for Oil wells, Railway sleepers
and Air strips.
The company also produces around 160 MW of Power through thermal and
renewable
energy with an aim to increase the power generation from non-conventional
methods.
Page 40 
PRIVATE EQUITY IN INDIA 

Over the past 7 decades, the company has earned the trust of the
employees,
distribution chain as well as all its stakeholders. DCBL’s vision has
been acknowledged
by the existing Private Equity investor, Actis who has been on the Board
and adding
valuable insights for the organisational growth. The company is looked
upon and
respected for being a value-based organization. DCBL has been recognized
and
awarded Hewitt’s Best employer for the year 2009. It has been ranked
among the Top
Ten in the Manufacturing industry. DCBL is Head Quartered in New Delhi.
It has
employee strength of more than 3,500 people.

PE Impact on DCBL

Dalmia Cement (Bharat) Ltd. (DCBL), and Kohlberg Kravis Roberts & Co.
L.P. (together
with its affiliates, “KKR”) announced the signing of a definitive
agreement under which
KKR has agreed to invest up to Rs 7,500 mn in DCBL’s wholly owned
unlisted
subsidiary (“Company”) which will house post restructuring DCBL’s 9MTPA
cement
manufacturing capacity, DCBL’s stake in OCL India Limited (5.3MTPA
capacity) along
with the upcoming green field projects of 10MTPA across the country. The
use of
proceeds will be for both organic/inorganic growth and de-leveraging.

“When we realigned our businesses in March, 2010, one of our goals was to
create
separate pure play entities that could thrive on their own and have
flexibility to raise
capital. This transaction with KKR is not just about capital but the
foundation of a long
term relationship. It will enable us to enhance our capacity and market
share through
organic as well as inorganic routes, while benefiting from KKR’s global
network and
proven value creation capabilities,” said Mr. Puneet Dalmia, MD of Dalmia
Cement
(Bharat) Limited.

“We are excited to be working with a dynamic and entrepreneurial family

with a
successful execution track record in India. While the cement industry by
nature is
cyclical, this is a long-term investment in a great family business, its
management team
and in India’s economy. This is a way to invest behind and contribute to
the continued
development of India’s residential, commercial, and public sector
infrastructure,” said
Mr. Sanjay Nayar, CEO of KKR India.

Page 41 
PRIVATE EQUITY IN INDIA 

Air Deccan - ICICI Ventures & Capital International

Air Deccan was established in 2003 with the objective of setting up a

budget airline, the
first of its kind in India. Price sensitivity and the aspirations of the
typical Indian
consumer were cited to be the main reasons for a budget airline.

Initially, the company’s operations revolved around the founder, Captain

G. R.
Gopinath. Modeled on Southwest Airlines in the U.S. and Ryan Air in
Britain, Air
Deccan positioned itself as an airline for the masses. Seeking capital
for growth, Air
Deccan obtained PE investment from ICICI Ventures, which invested USD 30
mn in
2004 for a 19 percent equity share. Air Deccan also received PE
investment from Capital
International, an American PE firm, which, it hoped, would provide a
global presence
and learning from the operations of similar airlines in other countries.

Both ICICI and Capital International played an active role in formulating

strategy. With
the PE firms’ assistance, Air Deccan appointed a person from Ryan Air to
run the
business.

The funds were intended to build capacity in a phased manner. Accessing

PE funds was
critical for being able to raise the much needed debt and to guarantee
leases, without
which project implementation would have been difficult.

The funds were also used to enhance plane capacity quickly by ordering 60
airbuses on
purchase and leased bases. By 2007, Air Deccan flew into 68 cities, as
compared with the
incumbent, Government owned Indian Airlines coverage of 45 cities.

The high capacity was both an advantage (as it became an attractive

acquisition target
for Kingfisher) and a disadvantage (as it adversely impacted the company
financially
due to the economic slowdown and unforeseen spike in fuel cost).

Page 42 
PRIVATE EQUITY IN INDIA 

The airline industry began to face significant changes in its operating

environment from
2005. Large rises in fuel prices and competition from other budget
airlines like Spice Jet,
Indigo and Go Air adversely affected Air Deccan’s profitability. With
ICICI Ventures’
assistance, some of the aircraft that had been purchased were re-
contracted on a lease
basis, thereby improving cash flows.

In 2006, Air Deccan offloaded 25 percent of its equity in an IPO. The IPO
took place
during a very difficult time for Indian equity markets. Fortunately, with
ICICI’s support
in the form of stepped up funding as well as marketing to other
investors, the issue was
completed at the offer price. At its peak, the market capitalization of
Air Deccan
reached USD 1.1 billion.

By late 2007, the ongoing pressure of competition and lower than expected
growth
forced Air Deccan into significant losses. In 2008, the company was
merged into
Kingfisher Airlines, a premium domestic airline. Kingfisher was attracted
by Air
Deccan’s large fleet that enabled Kingfisher to rapidly scale up its
operations. Although
the initial understanding was that Air Deccan would be the budget brand
of Kingfisher,
it was later rebranded with the Kingfisher name.

Impact of PE on Air Deccan

The PE investment in Air Deccan brought both operational and fiscal
discipline. PE
firms helped setup a proper organization structure and created a formal
business plan.
The financing enabled Air Deccan to pursue its aggressive business model
of running a
budget airline.

Impact of PE on the industry

Air Deccan had a big impact on the industry. Its no-frills flights focus
on second-tier
cities, and aggressive pricing led to aggressive growth and spurred the
entry of
comparable budget airlines. Its practices were imitated by established
competitors and
became part of industry practice. The result was a fall in the average
cost of air travel in
India. To a significant extent, these new business approaches were
enabled by the initial
round of funding and the models that were introduced by PE financiers
seeking to
imitate the success of budget airlines in other countries. Thus, we may
conclude that PE
significantly impacted the industry.

Page 43 
PRIVATE EQUITY IN INDIA 

Paras Pharmaceuticals-Actis
Paras Pharmaceuticals is one of India’s leading OTC healthcare and
personal care
companies, with a track record of introducing successful branded
products. Its two
leading brands, MOOV (a pain relieving ointment) and D’Cold (a cough
syrup) are both
in the top 10 OTC brands in India. Personal care products are among the
fastest
growing consumer segments with a growth rate in recent years at 14
percent. Paras
have grown faster and expect to grow by 25 percent in FY 2010-2011.

Actis, a PE firm, invested USD 42 mn in 2006 for a minority stake,

raising it to a majority
shareholding in 2008, which they continue to hold. Actis’ rationale for
the initial
investment was based on Paras’ ability to create strong brands in niche,
fast-growing
areas. They were impressed with the company’s ability to compete
effectively against
global organizations with innovative products; for example, the success
of MOOV in a
market dominated by market leader Iodex (a Glaxo brand).

Actis’ view of Paras noted above is shared by its promoters. As a key

company insider
commented: “A company goes through three stages: incubation, implementing
the
initial vision and professionalization.” At the second stage, the team
needs to be willing
to take risks and follow the founder’s vision. Professionals are likely
to be too risk-
averse to do so as failure would hurt their long-term career prospects.
At the third
stage, once the vision has been implemented, professionals need to take
charge.

It was at that third stage that Paras sought Actis as a PE investor to

enable the
transformation to a professionally-run company. In fact, the money was
the minor part
of the transaction in a sense, since it was used primarily to buy out the
promoter’s
holding rather than to be infused into the company (the company was
already cash
rich). Paras required the PE firm to possess a deep understanding of the
industry as
well as understand the company, both of which Actis possessed. As a
company insider
notes: “PE is expensive money: it should only be used if it comes with
other benefits.”

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PRIVATE EQUITY IN INDIA 

PE backing provided the company credibility as a professionally run-

organization and
there was an influx of younger, highly trained talent that replaced
family recruits.
Paras’ recruitment of the best quality professionals led to positive
impacts on
operational management with a greater focus on efficiency, tighter
financial controls,
brand leveraging and an improved marketing and distribution strategy.

The transformation of Paras from a family run to professional company

faced the
challenges of cultural transformation and was not a simple task but
accomplished by
focusing on these key areas and showed clear results. EBITDA margins rose
from 20
percent prior to PE funding to about 30 percent afterwards. Subsequent to
the Actis
investment, the company has also expanded internationally, especially in
the Middle
East and North Africa.

Impact of PE on Paras
As is evident from the above, Actis’ impact was transformative in the
sense of changing
how the company was run, while being supportive of a quality that was
already
ingrained, that of conceptualizing and developing a range of high-margin
products that
could successfully compete with large players, many of which are global
organizations.
Actis achieved its transformation by getting to know the company, and
then bringing in
talent in selected areas that were critical for raising margins and
enabling the efficient
introduction of new products, while retaining the innovative core intact.
Among the
many positive effects was a change in practice in procurement, governance
and
reporting, thus enabling a stronger brand being built? As a result,
revenue growth rates
rose to 40 percent and gross margins rose by 10 percent. Actis also
supported the
strategic shift in sales and distribution networks; as well as
international expansion.
Critically, Actis was able to bring in a sophisticated board support
through a domain
expert and bring on board a prominent business leader (who is their
advisor) as an
advisor to the company.
Impact of PE on the industry
The investment shows that a domestic company can succeed while competing
with
global organizations. Although there are other successful examples, such
as Dabur,
Paras is a special case of achieving this through professionalizing a
family-run firm in a
credible way, with a majority of non-family ownership, while retaining
the benefits of
incorporating the initial promoters into the core management structure.

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PRIVATE EQUITY IN INDIA 

Shriram Transport Finance-TPG

Shriram Transport Finance (STF), India’s largest commercial vehicle

finance company,
was established in 1979. As of March 2010, the company runs 479 branches
and service
centers offering finance for purchasing commercial vehicles, including
trucks, three-
wheelers and tractors. The company also offers ancillary services,
including working
capital and a cobranded credit card. The company has been consistently
profitable for
several years. For the financial year ended March 2009, STF’s revenue was
INR 36.9
billion and PBT was INR 2.9 billion. It employed 12,500 persons. The
company has been
quoted on the stock exchanges for several decades. As of March 2010, its
market
capitalization was INR 91.6 billion.

The truck financing business at the time, and even as of 2010, was
fragmented and high-
cost due to the risks and transactions costs of lending to unorganized,
single-truck
owners. STF catered to this market but was also beginning to access the
organized
borrowers that were coming into play as the trucking business became more
organized
in India. These factors had enabled STF to perform well in a regulatory
environment
that was significantly more favorable to banks than to NBFCs. However,
the company
was undercapitalized at the time of receiving the PE investment.

The company subsequently received multiple rounds of PE investment. In

2005, PE firm
Chrys Capital invested USD 30 mn for a 17 percent holding in STF. It
exited in 2008-09.

Global PE major TPG invested USD 100 mn in 2006 and, as of 2010, remains
an active
investor. TPG was interested in the financial sector in India, but the
banking regulations
prevented it from buying a large holding in a regulated bank. TPG was
attracted by
STF’s stability in terms of customers and credit-ratings, in the midst of
the NBFC
meltdown at the time. STF further attracted TPG because of its reputation
of integrity,
efficient management and customer loyalty.

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PRIVATE EQUITY IN INDIA 

The first PE funds were used by STF to integrate its regional operations
and control
them from its home base in Tamil Nadu, as well as to consider
international expansion.
The second round of investing, from TPG, brought in high standards of
credit
evaluation and corporate governance. TPG’s portfolio of Asian finance
firms, such as
First Bank, Korea, provided it with the experience to establish these
stronger standards.
These were needed as the management was largely promoter dominated, which
made
credit rating agencies and investors somewhat cautious. Also, their
securitization
business was relatively undeveloped.

Helped by better practices, STF’s portfolio, which was at USD 1 billion

in assets when
TPG invested, had risen to USD 6.5 billion by 2010.

Impact of PE on STF

PE initially enabled a national strategy, when Chrys Capital invested in

STF. Till then,
STF’s four regional entities operated independently. Thus, in the words
of a company
insider: “Chrys Capital provided capital during the growth phase of STF.”

TPG’s investment transformed the company through better internal

management
practices and corporate governance. The same insider notes that, where
Chrys Capital
enabled growth, TPG “added value”. TPG helped in improving the credit
rating of the
company and developing the company’s securitization business. TPG,
therefore, is an
example of a PE investor with deep pockets and experience in running
financial firms in
Asia and elsewhere bringing these advantages to STF.

Impact of PE on the industry

STF is the country’s largest player in commercial vehicle finance. The

primary impact of
the PE investment on the industry was to begin the transformation of the
business from
a fragmented, money-lender dependent business to a more organized
business.
Page 47 
PRIVATE EQUITY IN INDIA 

Gokaldas Exports Ltd. – Blackstone Group

Blackstone Group, among the world largest buyout firms, has accelerated
its
investments in India, pulling off its second buyout deal in less than
three months by
picking up a 50.1% stake in Gokaldas Exports Ltd, the country’s largest
garments
exporter, for $116 million and setting aside another $49 million for an
open tender
mandated under local securities laws for an additional 20% of the
target’s shares.

The holding of the promoters in Gokaldas Exports, the Bangalore-based

Hinduja family
(not related to the Hinduja Group) will come down from 70.1% to 20%
before the open
offer.

Blackstone saw large opportunities in the garments outsourcing business

and expects
firms from its overseas portfolio and extended network to outsource
manufacturing to a
400-acre so-called special economic zone that Gokaldas is setting up at
Kanakapura
outside Bangalore.

“We are associated with a large network of retailers through our global
portfolio of
investments who may want to outsource to India,” said Akhil Gupta,
managing director
of Mumbai-based Blackstone Advisors India Pvt. Ltd.

Companies running operations from special economic zones or SEZs enjoy

several
incentives. The Gokaldas SEZ, expected to employ around 50,000 people,
will house
units of several garment manufacturers. The company will have a unit that
will employ
around 4,000 people in the SEZ.

“More companies will outsource (to) us,” said Rajendra Hinduja, managing
director of
Gokaldas Exports, referring to the benefits of the sale. “We will get
access to textile

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PRIVATE EQUITY IN INDIA 

companies in the US that have investments from Blackstone.” The names of

such
companies were not immediately available. Gokaldas earns more than 96% of
its
revenue from exports to global brands such as Tommy Hilfiger, Nike and
Adidas, and
to large retailers such as Wal-Mart Inc. and Gap Inc.

The Bangalore-based garments firm earned a profit of Rs70.3 crore on

revenue of Rs
1,044.9 crore for the year to March.

Armed with a stake over 70% in Gokaldas, the buyout firm expects to play
a more
active role in the company than most of its peers in private equity, who
typically play
the role of financial investors. Gupta said that apart from participating
at the board
level (Blackstone will have three board positions at Gokaldas),
Blackstone will get
involved in actively managing the company by adding professionals,
bringing in global
best practices such as Six Sigma and beefing up the company’s marketing
operations in
the US.

Blackstone, which will pay Rs275 per share or a premium of 25% for the
shares of
Gokaldas, had initially prospected the Bangalore target as a ‘growth
deal’ with the
intention of acquiring a minority stake. Blackstone has invested $525
million, excluding
Gokaldas, in India and intends on deploying $2 billion up to 2010.

In terms of deal size, this transaction ranks third in India for

Blackstone, whose local
portfolio is led by a $275 million investment in media house Ushodaya
Enterprises Ltd.
The financier invested $50 million in mid-sized drug maker Emcure
Pharmaceuticals
Ltd.

Gokaldas employs over 54,000 people in 46 factories and is among the

largest
employers in the garments business.

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PRIVATE EQUITY IN INDIA 

Success of Private Equity in India

Though the Sensex closed 2009 with a 81 per cent gain thanks to renewed
FII inflows in
the second half of the year, this recovery in the primary markets did not
help the PE
activity. The number of Private Equity deals (PE) in 2009 slid to a 4-
year low, according
to a new report on PE activity in India.

Despite a surge in the secondary market in response to negative investor

sentiments,
the PE market witnessed just 191 deals in 2009 compared to 312 and 405 PE
deals in
2008 and 2007 respectively. This was a decline of 39% over 2008 and 53%
on 2007 levels.

In terms of deal value, 2009 raised $3.35 billion from the market — the
lowest in the last
four years — as compared to $10.59 billion in 2008 and $19.03 billion in
2007. Out of the
191 deals, as many as 118 came in the second half of 2009, garnering $1.8
billion and
accounting for more than 50% of the total deal value in 2009.

Telecom, Media & Technology emerged as the hottest sector of 2009. It

accounted for 60
deals in 2009. Telecom, Media & Technology sector witnessed 31.4% of
total deals
followed by Industrials and Real Estate & Infrastructure with 22.5% and
11.5%.

India accounted for 6 per cent of total global PE deals volume in 2009,
while only 2 per
cent in terms of deal value. The deal activity in India declined by 39
per cent and 68 per
cent in terms of deal volume and deal size respectively in 2009 as
compared to 2008.

Some reasons for success of private equity in India are:

Better environment for investment- The Indian economy has been enjoying a
period of
sustained growth at around 8 per cent a year. The latest boom has
attracted the
attention of private equity houses who have been participating in an
unprecedented
number of investment deals. In sharp contrast to the time private equity
funds invested
in India from a base overseas (for example Singapore), many private
equity firms have
now established a presence in the country, spurred on by a bullish market
and some
spectacular and well documented exits. This reflects the importance of
understanding

Page 50 
PRIVATE EQUITY IN INDIA 

local markets and working closely with promoters (families or controlling

shareholders), as well as the benefits of local decision making.

Innovative ideas- The Indian private equity market is different from that
of Europe or
the United States in that small family-owned and family-managed
businesses account
for a high proportion of the market and therefore investment
opportunities are higher
than Europe and US. The next generation having different mindset and they
believe in
innovation, i.e. Ranbaxy, which sold its stake in Daiichi, was result of
innovative
mindset. The average deal size in India is significantly lower than in
China or South
Korea, for instance, but 6,000 companies are listed on Indian exchanges,
a huge number
by any standard, and the rising performance of the stock market since
2004 has resulted
in substantial wealth creation for families with majority stakes in
listed companies.

Improvement in management skills- Among non-listed family companies there

has
been a traditional reluctance to share ownership and surrender control.
However, there
are signs that private equity firms are willing to play a more active
advisory role in
parallel with their ability to raise growth capital — a prospect that
owners and
promoters are starting to find attractive. As well as providing capital
and financial
expertise, private equity firms are in a unique position to introduce new
disciplines and
much needed structural reforms, for example looking closely at the
quality of
management teams or challenging companies to introduce leadership
succession plans.

Investors’ role in decision taking- An aspect of private equity that

companies find
attractive is that they gain an investment partner who is able and
willing to provide
continuous advice and support. Here the Indian connection becomes
important, since
many Indian companies understandably want Indian solutions to Indian
problems.
Many companies appreciate being able to have in-depth discussions with
their
investment partners about a variety of business decisions, for instance
advertising
investment, merchandising or retailing.

Globalization- There has been phenomenal growth in the value of private

equity
investment in India over the past decade. With an expanding domestic
market and
additional opportunities brought by globalization, the impact of private
equity on
Indian business is likely to increase further in the coming years.

Page 51 
PRIVATE EQUITY IN INDIA 

Future of Private Equity in India

After a euphoric two years, the second half of 2008 and the first half of
2009 have
mirrored global trends difficult for PE investments in India. Until last
year’s credit
crunch, deal sizes had been increasing and were hotly competed for at
high premiums.

Today, the PE landscape has changed due to the global financial crisis.
There have been
fewer exits and lower volumes. Allocations to PE funds by Limited
Partners (LPs) are
down, some even requesting a rescheduling of existing commitments. In
response,
some PE funds, notably some global funds, have reportedly reduced their
management
fees and reduced LP commitments.

It is likely that India will continue to be among the developing world’s

largest
destinations for growth capital, while control and buyout deals will be
sought only by
the largest funds. However, deal volume and average deal size have
declined, driven by
declining capital overall, with recovery only in Q2 2009.

PE funds will find another change in their operating environment: that

global LPs are
likely to invest in fewer funds than before, picking those whose
management teams
have operating experience and a track record. The reduction in capital
from overseas
may be offset to an extent by the emergence of a number of domestic LPs
investing from
family and corporate accounts. Overall, however a smaller PE industry is
likely, this is a
healthy development. Previously, about 350 funds were active. The market
was
oversupplied with capital relative to the quality of targets.

The future of PE is bright in India because India is an untapped market

for private
equity. The spending of infrastructure is in large amount in India.
Another reason for
opportunities in India is that India is one of the few growing economies
in the world
even in recession.
 The collapse of the IPO market is a factor, leading to a shift in exit
to lower-yielding
strategic and secondary sales. However, older funds with investments
three years or
longer on average are yet exiting with high returns.

Page 52 
PRIVATE EQUITY IN INDIA 

Driven by less capital, higher due diligence and lower deal closure, the
PE industry is
turning to more intensive portfolio management. Providing financial
support is now
less important than operational and strategic support, quality corporate
governance and
regulatory compliance. As the PE industry settles into its new habitat of
a tighter
investment funnel and longer-term holdings, investment choices will shift
to domestic
demand-driven and non-cyclical industries like infrastructure, healthcare
and
education.

The logic of investing in scale and in locations of growth means that

India will likely be
at the forefront of a global PE recovery. The year ahead should be viewed
as an
opportunity to build value in portfolio firms, and thus to show that PE
is an integral
part of India’s future.

Page 53 
PRIVATE EQUITY IN INDIA 

SEBI Guidelines

| 1. The Securities and Exchange Board of India (SEBI) issued its

Regulations for
Venture Capital in 1996, thus establishing the agency’s authority
over the funds,
the limits on their activities, and incentives for them to finance
and rescue
troubled companies. There are no legal or regulatory differences
between
venture capital and private equity firms. The Government first
permitted
financial institutions (Industrial Development Bank of India, ICICI,
and IFCI),
commercial banks (including foreign banks), and subsidiaries of
commercial
banks to establish venture capital companies under guidelines issued
in 1988. In
addition, under current central bank regulations, banks’ investments
in mutual
funds catering to venture capital funding are considered to be
outside the
ceilings applicable to banks’ investments in corporate equity and
debt.

| 2. Foreign venture capital funds have been permitted to operate in

India since
1995. They may either hold the shares of unlisted Indian companies
directly (up
to a maximum of 25% of equity) or route their investments through
domestic
venture capital funds and companies. Before guidelines were issued in
September 2000, direct exposure by offshore private equity funds in
shares of
unlisted companies was treated as a foreign direct investment and had
to be
approved in line with the Government’s general policy on foreign
investments.
Indocean Venture Fund (now Indocean Chase), originally set up by
George Soros
and Chemical Bank in October 1994, was the first such overseas
private equity
fund.
 | 3. The regulatory environment for the private equity industry was
simplified in
1995–2000. Foreign institutional investors participated in the growth
of the
private equity industry through the foreign direct investment
regulations of the
Government and the simplified tax administration procedures under the
Indo-
Mauritius Double Taxation Avoidance Treaty. While the foreign direct
investment route offered minimum investment restrictions for private
equity

Page 54 
PRIVATE EQUITY IN INDIA 

funds, exit pricing and repatriation of capital were regulated by

the Reserve Bank
of India (RBI). To bring these capital flows under the regulation of
the venture
capital industry, new SEBI regulations were issued with simplified
exit pricing
and repatriation procedures for foreign investors.

| 4. Following amendments to the 2000 budget, the Government has

allowed
private equity funds “pass-through” status, meaning that the
distributed or
undistributed income of the funds is not taxed. To avoid double
taxation, the
income of a private equity fund is taxed only in the hands of the
investor.

| 5. SEBI was also made the sole regulatory authority, and private
equity funds
must submit quarterly reports to it. In September 2000 SEBI announced
the
guidelines that now govern venture capital investment, based on the
January
2000 recommendations of the Chandra shekhar committee on venture
capital.
After another set of amendments in April 2004, the following rules
now apply:

(i) Foreign venture capital investors can invest in India without

the need for
approval from the Foreign Investment Promotion Board if they
register with
SEBI.

(ii) Each investor in a venture fund must invest at least Rs

500,000, and each fund
must have at least Rs50 mn in capital.

(iii) A fund may invest in one company up to 25% of the fund’s

capital. It cannot
invest in associated companies of ventures that it finances.
 (iv) A fund must invest 66.67% (lowered from 75% in April 2004) of
its investible
funds in unlisted equity or equity-linked instruments. The remaining
33.3% can
be invested in subscriptions to initial public offerings (IPOs) of
companies or in

Page 55 
PRIVATE EQUITY IN INDIA 

debt instruments of a company in which the venture fund has already

made an
equity investment.

(v) The April 2004 amendments removed the previous 1-year lockup
period for
IPO subscriptions. They also allowed investments within the 33.3%
category in
preferential allotments of equity shares of a listed company,
subject to a 1-year
lock-in, and in equity shares or equity-linked instruments of a
listed company
that is financially weak.

(vi) The removal of the profitability criterion as a listing

requirement had an
important effect on the private equity industry as it provided an
exit mechanism
for investors. To replace the profitability requirement, a firm
would be delisted if
it did not earn a profit within 3 years of listing.

(vii) The acquisition of shares in a venture fund by the investee

company or its
promoters is exempt from the provisions of the takeover code and
will therefore
not mandate an open offer.

(viii) Mutual funds may invest 5% of the capital of an open-ended

scheme and
10% of the capital of a closed-ended scheme in a venture fund.

(ix) In April 2004 the SEBI also removed some previous restrictions
and allowed
venture funds to invest in real estate companies, gold financing
companies, and
equipment leasing and hire-purchase companies registered with the
RBI.
 | 6. These regulations have significantly improved the regulatory
environment for
private equity funds operating in India, such as BTS India Private
Equity Fund.
In addition, they reflect the strong commitment of the Indian
Government to
support the provision of long-term equity finance to domestic
entrepreneurial
companies

Page 56 
PRIVATE EQUITY IN INDIA 

World’s Top 10 Private Equity Firms

According to an updated 2009 ranking created by industry magazine Private
Equity
International the largest private equity firm in the world today is TPG,
based on the
amount of private equity direct-investment capital raised over a five-
year window. As
ranked by the PEI 300, the 10 largest private equity firms in the world
are:

2009 PEI
Five-Year
300 Rank Firm name Headquarters
Fundraising

Total ($m)
1 TPG Fort Worth(Texas)
$ 52,352
2 Goldman Sachs Principal Investment Area New York
$ 48,993
3 The Carlyle Group Washington DC
$ 47,732
4 Kohlberg Kravis Roberts New York
$ 40,460
5 Apollo Global Management New York
$ 35,183
6 Bain Capital Boston
$ 34,949
7 CVC Capital Partners London
$ 33,726
8 The Blackstone Group New York
$ 30,800
9 Warburg Pincus New York
$ 23,000
10 Apax Partners London
$ 21,336

(Source: PEI Media 300)

Because private equity firms are continuously in the process of raising,

investing and
distributing their private capital rose can often be the easiest to
measure. Other metrics
can include the total value of companies purchased by a firm or an
estimate of the size
of a firm's active portfolio plus capital available for new investments.
As with any list
that focuses on size, the list does not provide any indication as to
relative investment
performance of these funds or managers.

Additionally, Preqin (formerly known as Private Equity Intelligence) an

independent
data provider, ranks the 25 largest private equity investment managers.
Among the
larger firms in that ranking were Alp Invest Partners, AXA Private
Equity, AIG
Investments, Goldman Sachs Private Equity Group and Pantheon. The
European
Private Equity and Venture Capital Association ("EVCA") publishes a
yearbook which
analyses industry trends derived from data disclosed by over 1, 300
European private
equity funds.

Page 57 
PRIVATE EQUITY IN INDIA 

Comparing the Indian PE Environment to Other Countries

Situation in => Developed Typical Developing Countries

India
Countries
Tax Stable Unstable
Unstable
Regulation Low-cost High-cost
High-cost
Cheap dept Available NA
NA
Institutional Equity Available Depends on the Regulatory/
tax/ Available
professional service
(differs by
country)
Equity Markets Developed Underdeveloped
Developed
“Agency conflict” in Present Absent
Absent
public companies
Corporate governance Not a concern Important
Important
Economic growth Low High
High
GPs with operating Not needed May or not be needed
depending Needed
skills on the kind of firms
invested in
Fund size Large Small
Small to large
Public markets for exit Developed Underdeveloped
Developed
PE portfolio risk relative At market or Higher
Higher
to market lower
Access to deals Proprietary Intermediated
Intermediated
Professional Services High Low
High
Quality
Holding period of 3.5 years Higher
Higher
investment
(Source:
KPMG- The Indian PE Model)
Page 58 
PRIVATE EQUITY IN INDIA 

Background
¾ KSL is the torch-bearer of the seventy-year old financial services
group of
Khandwala lineage.
¾ Incorporated as specialized Broking, Portfolio Management, Investment
Banking, and related financial services arm of the Group in 1993
¾ Top Management has combined wealth of experience in Indian Financial
market
of several decades.
¾ Innovative initiatives as Principal broking Member of National Stock
Exchange
in PMS and Indian Capital Market Developments
¾ Caters to several leading Foreign Institutional Investors, Mutual
Funds, Banks,
Corporate and High Net-Worth Individuals

Business Segments
| Market Intermediation
¾ Capital Market
¾ Futures & Options
¾ Wholesale Debt Market
¾ Currency Derivates
| Investment Banking
¾ Merchant Banking
¾ Mergers & Acquisition
¾ Strategic Partnership
¾ Capital Raising and Debt Raising / Syndication
¾ Corporate Advisory and Restructuring
| Portfolio Management Services
| Wealth Advisory Services
| Investment Advisory Services

Page 59 
PRIVATE EQUITY IN INDIA 

Board of Directors
™ Mr. S. M. Parande, Chairman
™ Mr. Paresh J. Khandwala, Managing Director
™ Mr. Rohit Chand, Director
™ Mr. Kalpen Shukla, Director
™ Mr. Ajay Narasimhan, Vice Chairman & Managing Director – TruMonee
Financial Limited

Registered & Head Office Mumbai

Vikas Building, Ground Floor, Green Street, Fort, Mumbai- 400 023
Tel No: +91 22 2264 2300; Fax No. +91 22 2261 5172;
Email: corporate@kslindia.com; URL: www.kslindia.com

Branch Office: Pune

C8/9, Dr. Herekar Road, Off. Bhandarkar Road, Pune- 411 004
Tel No: (91) (20) 2567 1404; Fax No. (91) (20) 2567 1405;
E-mail: pune@kslindia.com

Corporate Office
1st Floor, White House Annexe, White House, 91, Walkeshwar Road,
Walkeshwar,
Mumbai – 400 006
Boardline: +91 22 4200 7300; Fax No.: +91 22 4200 7378

Branches
¾ HG 3, International Trade Center, Majuragate Crossing, Ring Road,
Surat - 305002, Gujarat
Boardline: +91 261 307 6276

¾ 201/202, Shoppers Plaza, Parimal Chowk, Waghawadi Road

Bhavnagar - 364001, Gujarat
Boardline: +91 271 8222 1391

Page 60 
PRIVATE EQUITY IN INDIA 

References

• www.wikipedia.org/wiki/Private_equity

• www.privateequity.com

• www.indiavca.org

• www.privateequityonline.com

• www.preqin.com

• www.warburgpincus.com

• Private Equity International

• Research by VCCEdge, April ‘10

• KPMG – PE Report May ‘10

• Annual Report of Bharti Airtel, 2008-2009.

Page 61