0.1 overview

Overview

CIIF offers an opportunity to international investors to gain an exposure to India’s core infrastructure sectors and benefit from the specialized knowledge, risk management capabilities and asset management expertise of the Kotak Mahindra Group. CIIF’s cornerstone investors include a leading global alternative asset manager and one of the largest banking and financial institutions group of Japan. CIIF also has investments from a policy based financial institution of the Government of Japan, and a leading life insurance company from Asia.

Investment Strategy

CIIF invests in companies engaged in power generation, transportation and energy management in India.

CIIF undertakes the following types of investments:

Direct investments in infrastructure assets, through selective investments in project companies across a range of infrastructure sub-sectors and

Investments in infrastructure holding companies, which are essentially investment vehicles created by project sponsors to further invest in downstream project companies. Since infrastructure holding companies, at the time of CIIF’s investment, have investments in underlying project assets in different stages of development, construction and operation, CIIF believes that investments in such holding companies offer the maximum opportunities for capital appreciation, as its underlying investments commence operations and mature in the medium to long-term, and thus get re-rated.

CIIF typically invests between USD 15 - 18 million per transaction. By participating in the mid-size infrastructure market, CIIF endeavors to:

Invest in less complex projects that are easier to implement
and operate and

Play in a segment that is distinct from large infrastructure projects that typically raise financing from global financial institutions and/or private equity funds. By focusing on a different segment, CIIF believes it benefits from a better ability to negotiate entry terms.

0.2 Cornerstone Investors

One of the largest financial services group in Japan with a significant presence in infrastructure project finance globally and a leading global alternative asset manager with assets across real estate, renewable power, infrastructure and private equity are the cornerstone investors in CIIF.

Other investors in the fund are a policy based financial institution of the Government of Japan, and a leading life insurance company from Asia.

The Investment Committee, which approves all investments, has senior representatives from the Sponsor and Cornerstone Investors and decisions are taken by consensus.

Our Team

0.3 our team

Suman Saha

Head – Infrastructure Fund

Suman Saha is Head of Kotak Infrastructure Fund at Kotak Investment Advisors Limited. Suman established the Infrastructure Funds management

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Akshay Gupta

Executive Director

Akshay is the Executive Director of Kotak Infrastructure Fund at Kotak Investment Advisors Limited...

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Arjun Amlani

Associate Vice - President

Arjun joined Kotak Investment Advisors Ltd in March 2020 & brings with him over 9 years’ of experience in project finance and corporate lending...

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Debasmita Ghosh

Associate

Debasmita joined Kotak Investment Advisors Ltd in July 2018. Prior to joining KIAL...

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Pratik Mehta

Senior Analyst

Pratik joined Kotak Investment Advisors Ltd in February 2020...

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0.4 Select Portfolio

Project Galaxy

In March 2015, CIIF committed approximately USD 18 million (together with a global renewable energy fund, a global infrastructure investment and advisory firm, and the management team, approximately USD 64 million in aggregate) to a new solar energy platform (“Galaxy”) with the objective of building a world-class investor-owned solar IPP which, by 2022, is expected to grow to a capacity of 385 MWp.

CIIF’s investment team had been tracking the Indian solar sector for some time and after the rapid fall in prices of solar modules and decline in solar tariffs to reasonable levels, it decided to actively pursue an investment in the sector in 2014. However, after analyzing virtually every existing solar platform at that time, all of which had significant legacy issues (e.g., un-hedged foreign currency debt, high and possibly unsustainable tariffs, unjustifiable valuation expectations), it decided to build Galaxy from scratch by partnering with a professional management team with a strong track record as well as experience in designing, developing, financing, constructing and operating grid connected solar IPPs in India.

Since the first drawdown in June 2015, Galaxy has organically grown to a portfolio of six operational projects with aggregate 235 MWp. CIIF’s investment team works very closely with Galaxy’s management team in monitoring plant performance, negotiating EPC and other procurement contracts, and raising debt and equity capital for the projects. CIIF is amongst the majority shareholders of Galaxy.

Project Cactus

Cactus involved an acquisition of 100% stake in (a) Five operating road assets and (b) a parcel of industrial land measuring ~330 acres from a stressed Indian infrastructure developer in February 2016, jointly by CIIF and another infrastructure fund managed by leading global alternative asset manager, which is also a cornerstone investor in CIIF(together “the Acquirers”).

The total consideration paid for the acquisition by the Acquirers was approximately USD 100 million. Each road asset is housed in an individual SPV. All the roads are operating, 4 laned and the combined length of the 5 roads is 240 km. All of them operate under concessions granted by the National Highways Authority of India, an entity owned and controlled by the Government of India. Four of the five roads are BOT (Annuity) projects and one is a BOT (Toll) project. The roads are geographically spread across 4 Indian states.

Routine maintenance and/ or major maintenance activities continue to be undertaken, and continue to be undertaken across the assets to maintain and improve their quality. Apart from the board, which meets regularly to review the performance of the assets and set near term targets, a specific asset management committee has been constituted where the critical day-to-day issues regarding the assets are discussed and decisions implemented.

Project Kinetic

Kinetic involved an acquisition of 100% stake in 2 operating BOT (Toll) road assets from two Indian infrastructure developers in October 2018, jointly by CIIF and an infrastructure fund managed by leading global alternative asset manager, which is also a cornerstone investor in CIIF(together “the Acquirers”).

The total size of this investment is approximately USD 284 million. Each road asset is housed in an individual SPV. Both the roads are operating, and the combined length of the roads is 373 km. The roads operate under concessions granted by the National Highways Authority of India, an entity owned and controlled by the Government of India. The roads are located in Andhra Pradesh, and connect important traffic corridors of the country.

Routine maintenance and major maintenance activities continue to be undertaken across the assets to maintain and improve their quality. Apart from the board, which meets regularly to review the performance of the assets and set near term targets, an asset management committee has been constituted where the critical day-to-day issues regarding the assets are discussed and decisions are implemented.

Project MAP

In May 2018, CIIF committed approximately USD 18 million (together with a global developer of clean energy infrastructure based in Canada) to a solar energy platform (“MAP”) with the objective of building a world-class investor-owned solar IPP which, end of 2021, is expected to grow to a capacity of 330 MWp with focus on catering to the pedigreed credit worthy counter-parties in the Commercial & Industrial (“C&I”) space.

CIIF has been present in the Indian solar sector since 2015, through its investment in Galaxy and it subsequently decided to invest more capital in the sector in May 2018 through its commitment in MAP. Since the first drawdown in August 2018, MAP has organically grown to a portfolio of ten projects at various stages of development and commissioning spread across various states of India.

CIIF has also been a pioneer in successfully on-boarding one of its Limited Partners, a Japanese multinational banking and financial services company, to co-invest in the platform, thereby setting a precedent in the industry and bringing the aggregate committed capital to approximately USD 45 million.

CIIF’s investment team works very closely with MAP’s management team in vetting of counterparties, selection of projects, negotiating EPC and other procurement contracts, raising debt and equity capital, monitoring project progress and plant performance.