Bain Capital, a renowned investment firm headquartered in Boston, has set aside $7 billion for investment in India over the next three to five years. This move comes as India’s stable political environment and steady economic growth make it increasingly attractive to international money managers. The firm also aims to expand its team of 25 private equity and special situations investment professionals by 15% to 20% over the next two to three years, according to Pavninder Singh, a partner and member of the Asian Pacific private equity team. Singh highlighted that this capital allocation represents a significant increase compared to the seven or eight years it took Bain Capital to deploy its initial $7 billion in the country.
David Gross, partner and founding member of the firm’s Asia business, emphasized India’s remarkable political stability, which aligns with the conditions conducive to robust and sustainable economic expansion. Global firms ranging from Canadian pensions to sovereign wealth funds in the Middle East and Singapore are pouring billions of dollars into India, attracted by its combination of strong economic growth and political reliability. For instance, Brookfield Asset Management manages approximately $25 billion in assets across infrastructure, real estate, and private equity in India, while Singapore’s Temasek Holdings Pte plans to invest up to $10 billion in the country over the next three years.
Bain Capital channels its investments in India through its private equity and special situations businesses, as well as the India Resurgence Fund, a partnership between Bain Capital Credit and Piramal Enterprises. Over the past 18 months, the firm has deployed around $2 billion across these strategies and distributed nearly $1.5 billion from its private equity arm to investors last year alone.
Bain has invested across various sectors in India, including IT services, financial services, pharmaceuticals, and industrials. The firm is particularly focused on expanding its consumer retail portfolio to capitalize on the increasing consumer demand in the country. Singh noted that building on-the-ground presence and expertise over the past 15 years has been instrumental in navigating the Indian market successfully.
Moreover, Bain Capital sees promising opportunities in manufacturing across sectors such as automotive components, chemicals, and pharmaceuticals as investment flows diversify away from China. This shift is driven by the Indian government’s emphasis on infrastructure development, with Prime Minister Narendra Modi’s administration pledging approximately $120 billion in infrastructure investment by March 2024.
Looking ahead, Bain Capital plans to explore investment opportunities in India across its global strategies, including real estate, technology, and life sciences funds, over the next three to five years. Gross highlighted the growing demand for housing in smaller Indian cities, supported by improved transport infrastructure. Residential real estate demand has surged, reaching a nine-year high in 2022 and continuing on a positive trajectory in the first half of 2023, according to a report by Knight Frank.
“Real estate may present the biggest opportunity, and we have significant experience in this sector through our special situations group,” Gross remarked.
