Temasek India head Ravi Lambah says India fits well in the long-term structural trends of sustainable living, longer life spans, rising consumer spending power, higher connectivity, smarter system, a sharing economy and a more connected world.
"These are few structural trends that are driving our investment thesis. If I think about India in the next five to ten years, these trends will shape how we pick our bets. Currently, India fits really well in those trends," said Lambah in an exclusive chat with Business Today from Singapore few weeks ago.
Lambah is also the joint head for telecom, media and technology for the global investment firm.
In a post-COVID world, this Singapore headquartered investor is trying to find companies and opportunities that fit with the digitisation and consumption themes. Take, for example, Temasek had invested in Indian banks 16 years ago. "We continue to invest in Indian banks because banks truly represent a great proxy for the economic growth," says Lambah. The fund has investment in a small finance bank AU Small Finance Bank. the fund was quick to take a bet on the new banking model, which is more like a microfinance model.
Similarly, Temasek has investment in a full-scale Bandhan Bank, which also has a differentiated model of serving the underserved and unbanked regions. In the NBFC space, it has investments in Fullerton India, which is actually its subsidiary.
The global firm has its biggest exposure in China followed by Singapore and North America.
Lambah says the firm likes the platforms because in a platform one can put a lot of things and connect it to customers and suppliers. "Platforms make a lot of sense for us, generally. E-commerce is also a platform," says Lambah.
In the start-up space, Temasek had investment in a food-delivery app Zomato several years ago. "We put some more money in it recently," said Lambah.
Similarly, it had invested in digital models like PolicyBazaar, Billdesk and CarTrade many years ago. Pine Labs, a Point of Sales deploying company, is another new-age company where Temasek had invested early on.
Over the years, Temasek has been very selective and cautious in picking bets in India. "Over the next several years, we will stay close to our trends and be cautious, but we are looking forward to deploying more capital in India. We are positive on India," said Lambah.
Indian investment is less than 5 per cent of Temasek's global portfolio.
The fund doesn't allocate capital based on geography or sector. It instead follows a bottom-up approach. "If we find a good opportunity in India, we will do it," said Lambah. "We ended our balance sheet in the net cash position for the last decade, so we have plenty of capital to deploy when it comes to the right opportunities."
Post the pandemic, Temasek has been spending a lot of time with its portfolio companies. The main focus of its dialogue is to find stress points and help them put capital wherever necessary. "Our whole focus has been simply to help our portfolio companies, so that when they come out of COVID-19, they are stronger than before," says Lambah.
"Fortunately, our portfolio is very resilient. We don't have much stress in it," he adds.
"While the growth may go up and down year-to-year and we might end up seeing 4 per cent or 5 per cent growth or negative 24 per cent growth which we saw in the last quarter, but being a long-term investor, we don't get so perturbed by these short-term volatilities in these metrics," said Lambah.