Exclusive: KKR looks at its largest Asia Infras Fund, India to angle a large slide

Copyright © HT Digital Streams Limit all rights reserved. The firm has already acquired obligations for a first closure for the new fund from its limited partners and will announce it soon. Summary India can be responsible for almost a third of the new fund, as world investors on infrastructure stories in the fastest growing market of the region double. Private equity giant Kohlberg Kravis Roberts (KKR) is working on its third and largest Asia Infrastructure Fund that could amount to $ 9 billion, three people who are familiar with the case, with a large share to India’s expanding road and energy to logistics networks. “The firm has already acquired obligations for a first closure for the new fund from its limited partners and will announce it soon,” said the first of the three people, who spoke on condition of anonymity. “Although the final fund size has yet to be confirmed as fundraising continues, it remains in the $ 9 billion range, while India remains a key market, in line with the previous funds.” The new fund exceeds the $ 3.9 billion debut Asia and the $ 6.4 billion II fund that closed last year. The people said that as much as 30% of the corpus can be allocated to Indian infrastructure. The country accounted for 25-30% of KKR’s first two Asia funds. Read also | KKR wants to sell sustainability again, can reach $ 1.5 billion CKR, is not alone. Competitive world investors such as Blackstone and Brookfield have also increased the bets on Indian highways to renewable energy plants, as the country has expanded and upgraded its core infrastructure base over the past decade, powered by public and private capital. Morgan Stanley expects the overall spending on the sector to gradually rise from 5.3% of GDP in FY24 to 6.5% with FY29. According to Vipin Singhal, director, Anand Rathi Investment Banking, has served a combination of factors – government initiatives, increasing urbanization, population growth and increasing foreign investment – the most important growth drivers for the infrastructure industry. “As a result, India is increasingly considered a strategic anchor for portfolios in Asia Pacific, especially as China investors diversify due to ongoing geopolitical tension.” The new fund of KKR is expected to focus on roads and highways, and play energy transition, except for renewable energy, while maintaining the flexibility to maintain other assets linked by infrastructure, the third person quoted above. KKR declined to comment on Mint’s inquiries. Big India Bet KKR’s Asia infrastructure strategy is led by Hardik Shah, who joined the firm in 2018. In 2021 it rented Ami Momaya of the National Investment and Infrastructure Fund (NIIF); She has been promoted to managing director for infrastructure, Mumbai in January 2025. Over the past few years, KKR has strengthened its Indian game by investing in power transfer via India Grid Trust (inigrid), renewable energy companies such as virescent infrastructure and hero future energies, highway assets under the highway infrastructure, desarbonization Account, and Weway Infrastucture Trust, Decarbonization Pog’s India. KKR also began to discuss profits from the Indian market. In February 2024, it left Indus Towers Ltd by selling its total stake of 4.85% for around £ 2,750 crore. In December, it assessed a 2.6% residence in Indigrid-India’s first listed power sector Infrastructure Investment Trust (Invit)-for £ 277 crore. Read also | KKR, Partners Group to lead DarwinBox Financing Round, although KKR recently out of Indus Towers, India Grid Trust, and some more infrastructure portfolio companies, KKR still intends to deploy its next $ 10 billion in India in an accelerated rate, which has a long-term rescue. said. While KKR has traditionally focused on credit, real estate and private equity, it is now making a strong pressure in infrastructure-concept in technical driven areas such as data centers, cyber security and AI platforms-which match the digital transformation of India, he pointed out. “It’s more a strategic reward rather than an exit from the Indian infrastructure space.” Craig Larson, partner and head of investor relations at KKR, said during the firm’s earnings call on May 1: ‘We will expect us to have some closures in America and we will launch fundraising for the flagship strategy on the heels of the topic that becomes a topic.’ Larson also pointed to continuing fundraising in Asia infrastructure, wealth platforms and climate-focused vehicles. From this year, KKR has fully deployed capital of its first two Asia -Infra funds, the third person quoted earlier said. The strategy, which began in 2019, has grown to about $ 14 billion in assets under management (AUM), which forms part of KKR’s broader $ 59 billion global infrastructure business. Competitive world investors strengthen their presence in Indian infrastructure. Brookfield said in May he plans to scale its Indian assets under $ 30 billion to $ 100 billion, with infrastructure, especially energy, renewable energy, digital, transport and aid programs, at the core. The current India infrastructure AUM amounts to $ 12 billion. Blackstone also aims to double its exposure to India from $ 50 billion to $ 100 billion, and it has expanded to infrastructure and credit with its large real estate, the firm said in March. Tailwinds ahead The revival in world capital coincides with robust market projections for the country’s infrastructure sector. The logistics sector of India, worth $ 317.26 billion in 2024, is expected to grow to $ 484.43 billion by 2029, while the warehouse market is expected to £ 2,243.79 billion by 2026, an annual growth rate of nearly 11%, according to a report from the India Brand Equity (Ibef), a Trust under the Trade Minister. The country has improved its ranking in the World Bank’s logistics performance index to 38 in 2023, higher than 44 in 2018, said Singhal of Anand Rathi Investment Banking. Read also | KKR to gain control over Healthcare Global in $ 400 million Deal Real Estate (Reits) and Infrastructure Investment Trusts (invitations) play an increasingly important role in funding these projects. Reit’s and invitations collected $ 15.6 billion (£ 1.3 Lakh Crore) in four years to March 2024, the IbEF report states, referring to data from the Reserve Bank of India. According to the report, India’s real estate sector drew investments to investments in the second quarter of 2024. The pressure continues in the Union budget 2025–26, with the capital investment for infrastructure up to £ 11.21 trillion, or 3.1% of GDP, of £ 10 trillion in the previous fiscal. According to Singhal, India is set on a major infrastructure bump with FY28, expecting that road investment almost doubles from $ 28 billion to $ 53 billion (17% CAGR), irrigation and water from $ 113 billion to $ 208 billion (13% CAGR), Railways from $ 122 billion to $ 196 billion (13% Cagr), and energy and energy from $ 161 billion to $ (15% Cagr). Catch all the corporate news and updates on live currency. Download the Mint News app to get daily market updates and live business news. More Topics #Private Equity #Pe -Firms Read Next Story