Most opportunities for private equity firms and foreign institutional investors came when the banks needed capital urgently. Now SFBs and mid-sized banks might seek fresh capital avenues for growth
Earlier in September, US-based GQG Partners, a boutique investment firm, had through two separate deals hiked its stake in IDFC First Bank, one of the fast expanding mid-sized banks in India. IDFC First Bank, which had moved into the top 10 most valuable listed banks in India – has probably just slid out of that list amid weak market sentiment. But it is seeing enough interest from private and capital market investors, as a bank whose loan book and deposits growth is strong, while staying profitable.
The GQG deal, in some ways, is reflective of what private equity investors, family offices and foreign asset management companies, besides institutional investors are seeing in Indian private or public sector banks, large or mid-sized. It is a simple conviction that if you are long on India, you need to be long banks.