Institutional investments: foreign investments jumps six times


FII investment jumps six times

Institutional investments in alternatives cross USD2.0Bn in 5 years

 foreign investments rise 6X since 2019

·       Share of alternatives in total investments rose from 3% in 2019, to 18% in 2022

·       Foreign investments accounted for 78% of the total investments in the sector

·       Data centers received USD1Bn of inflows since 2019, 51% of total investments in alternatives

Mumbai:  Alternative assets in India received cumulative investments of about USD2.0Bn during the last 4-5 years (2019-H1 2023), led by foreign investors. Foreign investments accounted for 78% of the total investments in the segment, as investors continued to seek newer markets and newer avenues segments to diversify their asset portfolio while enhancing risk adjusted returns.

Institutional investors who were primarily focused on core asset classes have been building up their non-core assets around Data centres, Life sciences, Co-living, amongst others. Investments in alternatives have witnessed

continued growth since 2019, driven by emergence of shared economy, increased digitalisation, and supportive government policy initiatives. 

During 2022, investment inflows in alternatives touched USD0.9Bn, a whopping 4.4X rise from 2019. Foreign investments in the sector have been the driving force and have witnessed a 6X rise in 2022 compared to 2019. 

Foreign investors continue to bet on the Indian real estate market, as India continues to be the fastest growing economies across APAC, Europe and Americas, with GDP pegged at 6.6% in 2023 by IMF. At a time when India’s economic outlook remains sturdy amidst global challenges, the business case for alternative investments will only strengthen.

Investments inflows in alternative assets (USD mn)

 

Year

Investment inflows (USD million)

2019

195.7

2020

359.0

2021

452.5

2022

866.7

H1 2023

158.2

*Note: Alternate assets include data centres, life sciences, senior housing, holiday homes, student housing, etc.

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