VCC TV is proud to introduce "The Deal Street", a brand new show that will go beyond news and bring you views, opinions and analyses from experts across the globe. In our first episode, we bring to you views of Limited Partners who have significant exposure to Indian private equities on the impact of the new government on the Indian private equity landscape.
Our debut panel comprises seasoned LPs—Nupur Garg, senior investment officer, IFC, Anand Prasanna, director , Morgan Creek Capital Management, Sunil Mishra, partner, Adams Street and Pratima Divgi, VP, FLAG Squadron Asia.
LPs realise that, besides General Partners, they also need to learn from the mistakes made in go-go days as the country enters another multi-year bull run. In candid confessions made during the discussion, LPs admit that both LPs and GPs made mistakes during the benign days of 2006-07 and which is where most of the money is stuck. Going forward, the scrutiny will primarily revolve around exits, the panel unanimously agreed, irrespective of the macro environment.
That decision-makers across the globe have very keenly watched the elections and are beginning to have a conversation about India - a stark difference from just a couple of years ago. LPs are, however, quick to add that cautious optimism on the macro front might not necessarily translate into dramatic turnaround for Indian private equity yet. This has primarily to do with the not-so happy return experiences from the past in the region.
However, LPs also noted that if the golden era of the private equity were to start now, it would last longer during this vintage as the panellists agreed that it's a better and a more experienced set of GPs out there now. In terms of strategies, early stage and PIPE look interesting in the current scenario, although LPs noted that growth equity continues to be the mainstay for Indian private equities. Talking on valuations, a few LPs noted that India is structurally an overvalued market.
In a free-wheeling discussion LPs also share insights on fundraising and how to avoid the mistakes of the past as we enter another year of excesses.
Watch the discussion for more.