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India: Where Lies the Next Big Investment Opportunity?

Author: Rajesh Subramaniam
Managing Director (India), Walden International
India: Where Lies the Next Big Investment Opportunity? -By-Rajesh Subramaniam
A vibrant economy, 1.1 billion people, a burgeoning middle class, 8 percent sustainable growth, robust legal and regulatory framework, and an entrepreneurial community continuingly looking to innovate make India an extremely promising investment destination. Our investment thesis is to seek, create, nurture, and develop investment opportunities across a wide spectrum of businesses that form the nucleus of fuelling the Indian consumption driven growth story. Every conceivable sector in India is under-penetrated. Financial services, healthcare, education, infrastructure development, logistics, and so on and so forth. Let’s take a look at some numbers: Outstanding bank credit of $650 billion compared to a GDP in excess of $1 trillion; mortgage to GDP ratio of 7 percent compared to 80 percent in the US and 86 percent in the UK. Healthcare spend is about 5 percent of GDP as against 15 percent in the US and is extremely fragmented. Private education spend estimate to reach $80 billion by 2012, which is currently, less than 5 percent of GDP. The opportunities to play in the supply chain of each of the sectors above will create valuable businesses in the future. The key opportunities lie in enabling access, creating a robust fulfillment framework, and productizing the learning that enables IP creation to drive innovation. Disruptive business models enabling dis-intermediation and consolidation at both ends of the spectrum and supporting superior execution are key. The pain points are many, solutions many, and capital finite. Backing passionate, highly driven entrepreneurs who are bold and audacious thinkers with proven execution skills is what we seek.

Application of technology is omnipresent in driving all forms of innovation; right from a block buster drug discovery to making hot dogs in lesser time that improves utilization and productivity. Breakthrough ideas in healthcare provisioning that saves lives, delivering financial services applications to the under-banked and helping them move up from the base of the pyramid, and enabling the best in class educational content and teaching access at price points that will penetrate beyond just the privilege of few are some of the key trends that we see evolving. With 500 milion+ mobile subscribers and an ever-increasing Internet penetration, the channels to create effective fulfillment models are real.

Some of the hottest technologies we see are in Wireless apps around security, IT and BPO businesses around RIM, and Cloud computing. Big opportunities are there around financial inclusion and the entire payments space across multiple channels. The ability of a framer to invest his surplus in mutual funds using his mobile is real. If executed well, the industry gets a potential 750 million customer base. Imagine the impact on the capital markets and ensuing wealth creation. Healthcare ideas are around diagnostics and medical services (general and specialized) network creation. Provisioning tele-radiology solutions and creating robust health information systems that drive speed, accuracy, and timeliness are among the emerging themes. Some of the core, under-penetrated sectors will grow 5-10x of GDP growth. The opportunity is real and it is time to put money to work. Several business models are fragmented and sometimes broken. Creating effective market places that eventually de-clog the supply chain and reduce the levels of intermediation are some of the key elements we look for in potential investment targets. We have seen the trends and points of inflexion in the US and more recently in China. Every $50 increase in per capita income will create a multiplier effect on size and scale of businesses that will benefit from higher disposable incomes.

Our advice to entrepreneurs is simple - Think big or go home. You have to be tenacious and stay spirited through the journey, which more often than not is turbulent and fraught with risks.

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Reader's comments(5)
1: From: Mrs. Mary David

This mail may be a surprise to you because you did not give me the permission to do so and neither do you know me but before I tell you about myself I want you to please forgive me for sending this mail without your permission. I am writing this letter in confidence believing that if it is the will of God for you to help me and my family, God almighty will bless and reward you abundantly. I need an honest and trust worthy person like you to entrust this huge transfer project unto.

My name is Mrs. Mary David, The Branch Manager of a Financial Institution. I am a Ghanaian married with 3 kids. I am writing to solicit your assistance in the transfer of US$7,500,000.00 Dollars. This fund is the excess of what my branch in which I am the manager made as profit last year (i.e. 2010 financial year). I have already submitted an annual report for that year to my head office in Accra-Ghana as I have watched with keen interest as they will never know of this excess. I have since, placed this amount of US$7,500,000.00 Dollars on an Escrow Coded account without a beneficiary (Anonymous) to avoid trace.

As an officer of the bank, I cannot be directly connected to this money thus I am impelled to request for your assistance to receive this money into your bank account on my behalf. I agree that 40% of this money will be for you as a foreign partner, in respect to the provision of a foreign account, and 60% would be for me. I do need to stress that there are practically no risk involved in this. It's going to be a bank-to-bank transfer. All I need from you is to stand as the original depositor of this fund so that the fund can be transferred to your account.

If you accept this offer, I will appreciate your timely response to me. This is why and only reason why I contacted you, I am willing to go into partnership investment with you owing to your wealth of experience, So please if you are interested to assist on this venture kindly contact me back for a brief discussion on how to proceed.

All correspondence must be via my private E-mail (dmary4love1@yahoo.fr) for obvious security reasons.

Best regards,
Mrs. Mary David.
Posted by: mary lovely david - Monday 26th, September 2011
2: Hi my dear,
My name is Mounace, i would like to establish a true relationship with you in one love. please send email to me at (mounace43@yahoo.com) i will reply to you with my picture and tell you more about myself. thanks and remain blessed for me,
Your new friend Mounace
Posted by: mounace love love - Thursday 09th, June 2011
3: A well structured and educative whistle blow at the right time is this article.
I think it will open windows for many to explore new opportunities
Deepak Menon
Posted by: DEEPAK MENON - Thursday 17th, March 2011
4: nice article
Posted by: Pankaj Pandeys - Friday 01st, October 2010
5: Nice article.
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