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Stephen Schwarzman, Chairman, Blackstone Says It is the Right Time to Bet Big on India

India has emerged as the fastest growing major economy in the world and backed by its strong democracy and partnerships, the country is expected to be one of the top three economic powers of the world in the next 10 to 15 years. The country’s GDP is estimated to grow by 7.3 per cent in 2018-19. According to a study by ASSOCHAM and Through Arbitrage Research Institute, based on the rate of population growth, increased labour force participation, and higher education enrolment, India’s labour force is expected to touch 160-170 million by the year 2020.   

While the country’s economic scenario had been on continuous improvement, there had been numerous investments in various sectors of the economy as well. The Merger & Acquisition activity in the country reached US$ 82.1 Billion until November 2018. Till November 2018, the Indian companies had raised around US$ 5.52 Billion through Initial Public Offers (IPO). The FDI inflows in the country reached US$389.60 Billion between April 2000 and June 2018. The country improved its ranking in the World Bank’s Ease of Doing Business Report by 23 spots over its ranking in 2017 and is currently ranked 77 among 190 countries in the 2019 edition of the report. India’s continuously improving performance in the Ease of Doing Business along with other major developments and favourable condition for foreign companies in the industry, set up by the market research companies in India has made it easier for major organizations to do foreign business in India.   
 Blackstone, the world’s largest private equity firm expects a reform-oriented government, weak rupee, bumper exits, and newer opportunities in bankruptcy and structured capital solutions while forming the ideal environment to reposition itself as an aggressive acquirer of local assets in the year 2019. Stephen Schwarzman, the Chairman of Blackstone said, “We have done remarkably well as a firm since 2015… became the largest commercial landlord in India,” in an interview. “In the private equity area, we deployed around $5 Billion. In total, we have deployed around $10 Billion and it has worked out incredibly well,” he added.   

Back in the year 2015, Schwarzman had said that India can create or hurt its own future. At the end of the year 2018, Schwarzman believes that the Indian market had been quite in favour of Blackstone. Blackstone has become the largest commercial landlord in India, having 120 million sq. ft. of space in which around 20 million is under construction. In the private equity area, the company has deployed around $5 Billion.   
 “We have the philosophy of building businesses and not investing in businesses... we are a group of well over $100 billion. In effect, we can create more revenue for an Indian company by introducing clients in our Blackstone family,” Schwarzman said at the group’s Indian headquarters in Mumbai. “In 2005, when we started in India, there weren’t many deals in the PE side. In the past two years, it has primarily been selling its India portfolio – with big exits at Intelenet and TransMaldivian Airways. This is expected to change now, on the back of a weak rupee.”  
 The company sees good potential with what looks to be the fastest growth in any major economy. With a strong dollar and a weak rupee, India makes the buying cheaper for the companies. Major organizations believe that as long as the country’s growth continues, India looks like a favourable environment to buy assets, given that the market entry strategy has been kept right in favour of the business. Schwarzman exclaimed, “In India, things are moving into the right time period to buying those assets. In other places in the world, markets generally appear to be declining whether it’s the US or Europe.”  

India carries innumerable opportunities for capital by some very high-profile big businessmen in the country. The need for capital for certain sectors is very large. And globally, there are very few such providers. The year 2019 is going to be a strong vintage in making new investments because of the underlying economy is very strong, proving to be favourable for major global giants to set up their business in India. The country offers a great time to make financial services investments and in the consumer business with the right commands from the experienced market research companies in India.  
 

Source-  
https://www.ibef.org/economy/indian-economy-overview  
  

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