Chan banks on growing Indian middle-income population
Singapore’s state-owned investor Temasek is bullish on India, saying it expects Indian economy growth to remain firm over the next two years, primarily driven b infrastructure-led capital expenditure.
“We expect growth to remain firm over the next two years, primarily driven by infrastructure-led capital expenditure, accelerated supply chain diversification, and a recovery in private consumption,” Temasek http://temasek.com.sg said in a report release on 9 July.
India has continued to see strong economic momentum alongside improving macro and political stability, said Temasek which has invested Electric Vehicle companies Mahindra Electric Automobile https://www.mahindraelectricautomobile.com/ and Manipal Healthcare Services http://manipalhospitals.com among others.
In the 2024 financial year (FY), Temasek’s portfolio exposure to India grew to 7%, from 6% a year ago, The Straits Times reported.
“The focus will be on fiscal consolidation, to increase spending on infrastructure and the green transition in India and to continue the privatisation that has been happening,” elaborated Alpin Mehta, head of real estate and deputy head of private equity fund investments at Temasek https://www.sgx.com/ .
Opportunities are also emerging in sectors including financial services, life sciences, technology, consumer and healthcare in India https://www.nseindia.com/ , he noted.
“There is a very large and growing middle-income population in India https://www.bseindia.com/ , with private consumption now accounting for about 50% to 60% of the country’s gross domestic product, observed Connie Chan, Temasek’s head of financial services.
Indian banks http://iba.org.in are a proxy for the macro economy, she said, adding that there are also opportunities in other areas of financial services, such as insurance, where people can now afford insurance policies as they become more affluent.
Temasek listed the US and India as providers of growth in its Net Portfolio Value (NPV) of S$389 billion for the financial year ended 31 March 2024, which was up S$7 billion from a year ago.
“The increase was mainly due to our investment returns from the US and India https://sbi.com.in/ , offset by the underperformance of China’s capital markets,” said Temasek in its financial latest report.
Temasek said it maintained a cautious but steady investment pace amidst global economic uncertainties, and invested SGD26 billion into opportunities in sectors such as technology, financial services, sustainability, consumer, and healthcare, aligned with the four structural trends of Digitisation, Sustainable Living, Future of Consumption, and Longer Lifespans http://deutsche-boerse.com .
Excluding Singapore, the US continued to be the leading destination for Temasek capital, followed by India and Europe while it has also stepped-up investment activities in Japan https://www.jpx.co.jp/english/ .
Temasek elaborated, “Our performance over the decade was lifted by higher returns from the US and India, offset by the impact of China’s market performance over the last three years. Overall, our portfolio exposure remains anchored in Asia.” Fiinews.com
