Temasek planning to invest $10 bn in India over 3 yrs amid China slump

Mumbai: Temasek Holdings plans to grow its exposure to India by investing $2-3 billion annually over the next two to three years, said a senior executive. The Singapore sovereign wealth fund counts India among its two most preferred markets globally - the other being the US. "We plan to invest about $10 billion in India in next three years as the returns from India have grown phenomenally well in the last few years as compared to markets like China," Ravi Lambah, head, strategic initiatives and head, India at Temasek told ET in an interview.

Temasek has deployed about $37 billion in India over the last two decades. Temasek's India exposure makes up 7% of its global portfolio by underlying assets, up from 4% in 2020. Temasek poured a record $3 billion in India in 2023.

"China's performance in the last 10 years has been slower. So, the money we made in China, we were able to diversify and use that to invest in America and India and other places," Lambah said. He said India was Temasek's best-performing market globally in the past decade.

"In India, the capital markets, the size of investments that you can do, the deal size you can do, have been steadily increasing because the financial markets have been expanding and maturing," Lambah said.

He said India's current high valuations are justified by its potential for above-average returns.

"India has always been a higher valued market. So, you always had to play the growth in the market and pay the premium. And therefore, if you found the right businesses, then would outstrip that premium valuation and still make a lot of good return," said Lambah.

He said Temasek is backing portfolio firms in India who are planning initial public offerings (IPOs) to tap a thriving primary market.

"So, we have some portfolio companies that have filed for IPOs like Ola. From our shareholder perspective, we are supportive of the plans that a company has to go for an IPO. We are long term, so we look at the long-term performance. The IPO price is just one indicator of price, that's all," he added.

In India, Temasek had been investing in the healthcare sector through its healthcare platform - Sheares Health.

Last year, the firm took an additional 41% stake in Manipal Health Enterprises from existing investors and the promoter family for ₹16,500 crore. This made Temasek the largest and controlling shareholder in Manipal Health through its unit Sheares Health with a total stake of 59%. Later, it sold an 8% stake to various investors including Abu Dhabi sovereign wealth fund Mubadala.

Presently, Temasek is in the process of winding down Sheares Health in line with its global strategy. Sheares Health is effectively being wound down and the investments are being transferred to Temasek.

"We see the opportunity in healthcare to be phenomenal in terms of what the country needs. It's actually gigantic," said Lambah.