KIC sets sights on alts investments with India office plans
Korea Investment Corporation (KIC) is poised to open its India branch office this year, setting its sights on infrastructure investments for a start, with the aim to branch out into alternative investments as well.
"The new branch office in Mumbai is expected to play a pivotal role in finding quality investment opportunities in alternative assets, particularly in private equity, including venture capital, and real estate and infrastructure, in the country," a KIC spokesperson told AsianInvestor.
The opening of the India branch is in the final phase of regulatory approval, the spokesperson added. According to industry sources in Mumbai, this process of documentation and preparation has now reached the stage where deciding on the right location for office space is the next step.
The spokesperson explained that one KIC official will be relocated to the Mumbai office from the Seoul headquarters, adding that the sovereign wealth fund also plans to hire staff from Mumbai, with "deep local expertise and understanding”.
ASIA PUSH
As of August 31, 2023, KIC’s total assets under management (AUM) were valued at $181.4 billion. Alternative assets made up 22.7%, with the sovereign wealth fund targetting to invest 25% of its total AUM in alternative investments by 2025.
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While the India presence will support KIC's alternatives push, it also underscores the sovereign wealth fund’s general Asia strategy.
“KIC has a positive long-term growth outlook for Asia, thus seeking to increase its investment allocation in the region as well as diversity investment portfolio of the region,” Jin Seoungho, CEO at KIC, told the public recently.
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Beyond its Seoul headquarters, KIC currently has eight personnel in its Singapore office, which was established in 2017, to cover Asia investments. The Singapore office mainly covers private equity, real estate and infrastructure sectors for Southeast Asia, India and Australia.
“The Mumbai office will help expand KIC’s investment network and capabilities in Asia, on top of its office in Singapore. Staff at the new office will actively collaborate with (the) Singapore office, as well as (our) headquarters in Seoul,” the spokesperson said.
GRADUAL GROWTH
KIC is also focused on growing gradually, by distinguishing between full-scale offices and branches overseas. Initially, representation is considered as a branch, which can then expand into an office, the KIC spokesperson explained.
As such, KIC currently has overseas offices in New York, London and Singapore. But its San Francisco unit, which opened in March 2021, is a branch, catering to the needs of Silicon Valley.
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For the initial branch stage in Mumbai, AsianInvestor understands that KIC will focus on investments in or alongside local asset managers’ or general partners (GPs) and fund vehicles. As relationships with local GPs evolve, direct investments will then be considered once the office capabilities and number of employees grow.
As an example, KIC’s San Francisco branch office has grown from one person initially to now four investment professionals, according to KIC’s own overview of investment-related staff across departments and global offices.
DESTINATION INDIA
KIC is following the lead of several global peers that have set up roots in India in recent years.
More recently, the British Columbia Investment Management Corporation (BCI), the investment manager for the public sector of British Columbia province in Canada, told AsianInvestor that it had hired its first infrastructure-related expert in Mumbai in January 2023.
Furthermore, Canada’s Ontario Teachers’ Pension Plan set up its Mumbai office in 2022. Singapore’s sovereign wealth fund GIC and Canada Pension Plan Investment Board (CPPIB) have run their Mumbai branches since 2011 and 2015, respectively.