OTPP Sets Up an Office in Mumbai, Plans Indian Investment Drive

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Swaraj Singh Dhanjal of Mint reports Ontario Teachers' sets up an office in Mumbai:

Mumbai: Canadian pension fund Ontario Teachers’ Pension Plan Board, which manages assets worth over C$242.5 billion (Rs14.85 lakh crore, has established an on-the-ground presence in India, with the opening of a new office in Mumbai to build on its existing Indian portfolio, the pension fund manager said in a statement.

With the establishment of an India office, Ontario Teachers’ becomes the third Canadian pension fund manager to set up a local team in India. Its larger counterparts CPP Investments and CDPQ already have local offices in the country.

Having a local team and office will support Ontario Teachers’ in sourcing investments, nurturing long-term partnerships, and attracting strong local talent, the pension fund said. The office is in the financial hub of the Bandra Kurla Complex and is Ontario Teachers’ sixth global office and third in the Asia-Pacific region.

Ontario Teachers’ holds a portfolio of public and private assets totaling more than C$3 billion (Rs18,374 crore) in India.

Its investments include a $350 million investment in Edelweiss Alternate Asset Advisors, a controlling stake in Sahyadri Hospital Group, and an investment in DailyHunt parent VerSe Innovations.

Ontario Teachers’ has made major investments in the infrastructure sector in India, committing to invest $300 million for a 30% equity stake in Mahindra Susten. It has invested Rs1,500 crore in NHAI’s roads InvIT and an investment in KKR’s India roads portfolio. It has also committed $1 billion to the National Investment and Infrastructure Fund.

“India is an attractive investment destination and will be one of our growth markets over the next 5-10 years. It has a large, growing, and dynamic economy, with openness to foreign capital which makes it a strategically important market for us," said Jo Taylor, president and chief executive officer, Ontario Teachers’.

The Mumbai office will target investments in India across all asset classes, including public and private equities, infrastructure, real estate, credit and venture and growth equity.

A founding team of approximately 10 team members will be based in Ontario Teachers’ Mumbai office by the end of 2022, comprising a mix of local talent and transfers from its other offices, the statement said. This presence is expected to scale further as Ontario Teachers’ investment portfolio grows in the coming years, it added.

Ben Chan, executive managing director and head of Asia-Pacific, manages all of Ontario Teachers’ activities in the region including oversight of its Hong Kong, Singapore and Mumbai offices. Deepak Dara has been appointed senior managing director and head of India and will take on this role in early 2023. “We see a breadth of attractive investment opportunities across public and private markets in India for a long-term investor like Ontario Teachers’," said Chan.

Keki Mistry, vice chairman and chief executive officer of HDFC Ltd, will act as a senior advisor to Ontario Teachers’. “In his global advisory role, Mr. Mistry is helping to further enhance Ontario Teachers’ market reach, providing access to a high-quality network and opportunities, and sharing guidance on market dynamics. He is not involved in the day-to-day operations of Ontario Teachers’ business," the statement said.

Abhirup Roy and Sriram Mani of Reuters also report that Canada's Ontario Teachers' plans Indian investment drive:

MUMBAI (Reuters) -India will account for 5-10% of Ontario Teachers’ Pension Plan’s (OTPP) assets in the next 15-20 years, as the Canadian fund looks to expand investments in areas such as infrastructure, healthcare and renewables, its CEO told Reuters on Tuesday.

OTPP’s current exposure to India is less than 2% of its $240 billion in assets globally.

“Our exposure to India will be a very significant part of the balance sheet,” Chief Executive Jo Taylor said in an interview in India’s financial capital Mumbai.

The fund opened an Indian office in Mumbai - its third in the Asia-Pacific region after Singapore and Hong Kong - and plans to hire 10 people by the end of the year.

While global funds and companies have invested billions of dollars in recent years in Indian startups and digital companies that have grown rapidly, Taylor signalled OTPP would take a different approach.

“I think where we will probably be of most value to India is actually being able to ... help with a lot of the infrastructure build out that India is looking to do,” he said.

OTPP will also focus on sectors like healthcare and renewables, Taylor said, expanding on recent investments the fund has made in the country.

Although OTPP first bet on an Indian company in 2016 via Alibaba-backed online retailer Snapdeal, it has made most of its Indian investments in the past year - including $300 million each in conglomerate Mahindra’s renewable energy assets and a buyout of hospital chain Sahyadri.

Taylor said that while assets in India were more richly valued than in some other countries, expectations of faster growth made them more desirable.

“What is interesting and attractive about India is that there is a pretty strong retail market looking for IPO opportunities and that’s a big asset for the country,” he said.

In an interview with the Economic Times, Jo Taylor said this: “India is the key to our Asia story. But with an office here, we think we will do better, be able to add value with more feet on the street, as we think we have a distinctive offering."

Take the time to read the entire interview here.

Earlier today, Ontario Teachers' put out a press release stating it is growing its presence in India with establishment of Mumbai office:

MUMBAI -- Ontario Teachers’ Pension Plan Board (Ontario Teachers’), a leading global investor with over C$242.5 billion / INR 14.85 lakh crore (all figures as at June 30, 2022), has established on-the-ground presence in India, opening a new office in Mumbai to build on its existing Indian portfolio. Having a local team and office will support Ontario Teachers’ in sourcing investments, nurturing long-term partnerships, and attracting strong local talent. The office is in the financial hub of the Bandra Kurla Complex and is Ontario Teachers’ sixth global office and third in the Asia-Pacific region.

“India is an attractive investment destination and will be one of our growth markets over the next 5-10 years.  It has a large, growing, and dynamic economy, with openness to foreign capital which makes it a strategically important market for us,” said Jo Taylor, President and Chief Executive Officer. 

The Mumbai office will target investments in India across all asset classes, including public and private equities, infrastructure, real estate, credit and venture and growth equity.

Growing our India team

A founding team of approximately 10 team members will be based in Ontario Teachers’ Mumbai office by the end of 2022, comprising a mix of local talent and transfers from its other offices. This presence is expected to scale further as Ontario Teachers’ investment portfolio grows in the coming years.

Ben Chan, Executive Managing Director and Head of Asia-Pacific, manages all of Ontario Teachers’ activities in the region including oversight of its Hong Kong, Singapore and Mumbai offices.

Deepak Dara has been appointed Senior Managing Director and Head of India and will take on this role in early 2023. As Head of India, Mr. Dara will be responsible for accelerating investment activities and enhancing portfolio management in India. He will report to Mr. Chan.

Mr. Dara joined Ontario Teachers' in 2020 as Chief of Staff to the Chief Investment Officer and has been instrumental in advancing many global and cross-asset class initiatives including the organization’s five-year investment strategy, India strategy and ambition on climate action. Prior to joining Ontario Teachers’ Mr. Dara was part of the leadership team of the Boston Consulting Group’s principal investor and private equity practice.

“I am very excited to return home and to take on the role of Head of India. I look forward to working with our asset class teams and partners in the region and bringing our global expertise to bear in India. The last 12 months saw a marked growth in our investment activities in India, and I am enthusiastic about the opportunity to further build out our presence, networks and capabilities in the country,” said Mr. Dara.   

Keki Mistry, Vice Chairman & Chief Executive Officer of Housing Development Finance Corporation Limited (HDFC Ltd.), one of India’s leading financial services conglomerates, has agreed to be a Senior Advisor to Ontario Teachers’. Mr. Mistry has nearly four decades of senior leadership experience in the banking and financial services sectors.

In his global advisory role, Mr. Mistry is helping to further enhance Ontario Teachers’ market reach, providing access to a high-quality network and opportunities, and sharing guidance on market dynamics. He is not involved in the day-to-day operations of Ontario Teachers’ business.

“I’m pleased to be partnering with Ontario Teachers’, one of the world’s preeminent institutional investors. I look forward to helping Ontario Teachers’ to continue to build its network and portfolio,” said Mr. Mistry. 

“We see a breadth of attractive investment opportunities across public and private markets in India for a long-term investor like Ontario Teachers’. I am excited to work with Deepak to build out the team and continue to grow our portfolio in India,” said Mr. Chan. “I’m also delighted that Keki has agreed to come on as a Senior Advisor. He brings an exceptional depth of expertise and an invaluable understanding of the region, which will be critical as we continue to grow our business in India.” 

Scaling our investments in India

Ontario Teachers’ holds a portfolio of public and private assets totaling more than C$3 billion / INR 18,374 crore in India. Some of notable investments include:

Capital Markets

  • Edelweiss Alternate Asset Advisors (EAAA): Investment of US$350 million with EAAA, the largest private debt manager in India, with a focus on performing and distressed private credit investment opportunities in the Indian market.

Equities

  • Investment in a private equity funds: ChrysCapital, which focuses on IT/Business Services, Pharma/Healthcare, Financial services, Consumer/New Economy, and Manufacturing, and Kedaara Capital, which pursues control and minority investment opportunities in India.  
  • Sahyadri Hospitals Group: The largest private hospital chain in the state of Maharashtra, comprising 8 hospitals with approximately 900 operating beds and 300 critical-care beds. Sahyadri was Ontario Teachers’ first control private equity buyout in India.
  • VerSe Innovations: One of the largest local-language based content platforms in India, which owns Dailyhunt (a news+ content aggregation app) and Josh (a Short Format Video app).

Infrastructure & Natural Resources

  • KKR road platform: Invested into KKR roads platform which currently has six roads and has entered into binding agreements to acquire another five roads. The 11 roads are 820 km in length across 10 states.
  • Mahindra Susten Private Limited: Signed binding agreements with the Mahindra Group to acquire a 30% equity stake in Mahindra Susten, a leading renewable energy business, at an equity value of INR 2,371 crore (~US$300 million). The parties will also explore setting up an Infrastructure Investment Trust (“InvIT”) comprising operational renewable assets. Over the next seven years, Ontario Teachers’ has committed to deploy an additional amount of up to INR 3,550 crore (~US$450 million) into the business and the InvIT.
  • National Highways Infra Trust (NHIT): Acquired a 25% stake for INR 1,500 crore (C$248 million) in NHIT, an InvIT sponsored by the National Highways Authority of India, the Government of India’s agency for national highway development.
  • National Investment and Infrastructure Fund (NIIF): Committed up to US$1 billion to NIIF, the largest infrastructure fund in India. The fund invests in equity capital in core infrastructure sectors in India with a focus on transportation, energy, and urban infrastructure.

Building on existing Asia-Pacific presence

The Mumbai office will serve to further enhance Ontario Teachers’ existing capabilities in the Asia-Pacific region. Ontario Teachers’ has more than 65 employees in the region and approximately $20 billion invested in Asia-Pacific across asset classes.

Ontario Teachers’ Hong Kong office, established in 2013, will continue to focus on the north Asian geographies including Greater China, South Korea and Japan. The Singapore office, established in 2020, serves as the base for investments into Southeast Asia, Australia, and New Zealand.

About Ontario Teachers’ 

Ontario Teachers' Pension Plan Board (Ontario Teachers') is a global investor with net assets of $242.5 billion as at June 30, 2022. We invest in more than 50 countries in a broad array of assets including public and private equities, fixed income, credit, commodities, natural resources, infrastructure, real estate and venture growth to deliver retirement income for 333,000 working members and pensioners.

With offices in Hong Kong, London, Mumbai, San Francisco, Singapore and Toronto, our more than 350 investment professionals bring deep expertise in industries ranging from agriculture to artificial intelligence. We are a fully funded defined benefit pension plan and have earned an annual total-fund net return of 9.6% since the plan’s founding in 1990. At Ontario Teachers’, we don’t just invest to make a return, we invest to shape a better future for the teachers we serve, the businesses we back, and the world we live in. For more information, visit otpp.com and follow us on Twitter @OtppInfo.

Ontario Teachers' has set up its office in Mumbai and is ready to expand its investments in India across public and private markets. 

Everything about the press release conveys how serious the organization is about its presence in India, from what Jo Taylor and Ben Chan state to placing Deepak Dara as Head of India and recruiting Keki Mistry,as a Senior Advisor.

When you are opening an office in India, you want to have a strong presence and have the right people advising you to build solid long-term relationships.

Ontario Teachers' is doing this. Mr. Dara is eminently qualified for the role he is assuming. He has extensive experience working as Chief of Staff to the Chief Investment Officer and has been instrumental in advancing many global and cross-asset class initiatives including the organization’s five-year investment strategy, India strategy and ambition on climate action. 

He is enthusiastic about returning home to take on the role of Head of India and is looking forward to working with their asset class teams and partners in the region and bringing their global expertise to bear in India.

He will be reporting to Ben Chan, Executive Managing Director and Head of Asia-Pacific, who manages all of Ontario Teachers’ activities in the region including oversight of its Hong Kong, Singapore and Mumbai offices.

In the Reuters interview, Teachers' CEO Jo Taylor is very clear: “Our exposure to India will be a very significant part of the balance sheet.”

The article states India will account for 5-10% of Ontario Teachers’ assets in the next 15-20 years as it looks to expand investments in areas such as infrastructure, healthcare and renewables.

Don't forget, Jo Taylor has stated that Teachers' is aiming to grow its assets to $300 billion by 2030, so in 15-20 years, it will have even more assets and its investments in India will be a very significant part of its balance sheet.

The areas of focus will be infrastructure, healthcare and renewables but the statement is clear, investments in India will be across all asset classes, including public and private equities, infrastructure, real estate, credit and venture and growth equity.

India is attracting a lot of foreign investors, especially in the renewables sectors where greater levels of domestic and foreign investment could see the country become a major renewable energy hub over the next couple of decades.

As part of its road map to achieve 100 per cent dependence on renewable energy by 2025, Amazon recently announced its first utility-scale renewable energy projects in India — three solar farms located in Rajasthan. These include a 210-megawatt (Mw) project to be developed by India-based developer ReNew Power, a 100 Mw project to be developed by local developer Amp Energy India, and a 110 Mw project to be developed by Brookfield Renewable Partners:

Amazon has executed more than 500 Mw of renewable energy PPAs with Brookfield globally, and now 110 Mw in India.

“The new Bikaner solar park development is being undertaken as part of the Brookfield Global Transition Fund. We look forward to partnering governments and corporates to accelerate their sustainability and decarbonisation goals,” said Nawal Saini, managing director, renewable power and transition, Brookfield.

By the way, Ontario Teachers' is an anchor investor in Brookfield's Global Transition Fund along with PSP Investments and IMCO (read more about how Brookfield is aiming to build 12-16 GW of renewable power in India over the next 10 years here).

On Monday, Apple said it is assembling its flagship iPhone 14 in India as the US technology giant looks to shift some production away from China. “The new iPhone 14 lineup introduces groundbreaking new technologies and important safety capabilities. We’re excited to be manufacturing iPhone 14 in India,” the company said in a statement.

What does this have to do with Ontario Teachers' opening up an office in Mumbai?

It just shows you that if tech giants like Apple and Amazon are investing heavily in India, it makes absolute sense to set up an office there to capitalize on the country's impressive growth, favorable demographics and openness to foreign investors.

Ontario Teachers' CIO Ziad Hindo said they did a deep dive into India a couple of years ago and "they were struck by how quickly the SWFs had set up shops and got on with it.”

Well, it looks like Ontario Teachers' is getting on with it now and this new office in Mumbai headed up by Deepak Dara will grow and play an instrumental role in expanding Teachers' investments in the country.

I repeat, everything about this press release was very well done, it demonstrates Teachers' is serious and committed to growing its presence in India and Jo Taylor is right, its investments there will represent a significant part of their balance sheet in 15-20 years, perhaps even sooner. 

I wish Ben Chan, Deepak Dara and the entire team in Mumbai a lot of success as they embark on this exciting new growth phase in India. 

Below, India is at the forefront of renewable energy, home to some of the largest ultra mega solar parks around the world. Its rising renewable energy use is one of the highest as well. But can India become a global hub for the renewable energy?

Also, Singapore and India are two nations that continuously exchange foreign investments. Pouring billions of dollars every year. What led to this is the trust and integrity in both nations' economies. Financial services, e-commerce, advanced manufacturing, are just among others that are pushing each country's attractiveness.

Third, India, one of the fastest-growing countries in the entire world has received the largest overseas development aid from Japan. From 2003 to 2017, the amount of aid has increasingly grown. Although not consistently on a year-to-year basis, they still have been the largest recipient of the program.

Lastly, a 4k Cinematic video of developing India, which takes you on a cinematic tour of the various ongoing infrastructure development projects in the country and a clip showing you why India is a rising superpower. 

I can go on and on, there is no question India is growing fast and it will figure prominently in the portfolios of global institutional investors. Ontario Teachers' is right to follow CPP Investments and CDPQ in setting up an office there, there will be plenty of opportunities especially in infrastructure, renewables, healthcare and financial services. 

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