The Hindu Business Line : Hedge funds bullish on India, other Asian markets

Speaking at the `Funds World India 2004' conference here today, Ms Joanne Murphy, Head of Sales (Asia Pacific), Alternate Fund Services, HSBC Securities Services, said more money is set to come into hedge funds in the next few years.

She said the share of investment by hedge funds in Asia is still small but it will grow.

She said India is a new market for hedge funds and once they are allowed to invest here directly they will grow. At present, investment by hedge funds is very low in India, as they are not allowed to invest directly.

According to Ms Murphy, there has been unprecedented growth in the hedge funds industry. She said from $8 billion of asset under management in 2000 assets have grown to $31 billion in 2001, $50 billion in 2002 and to $60 billion by 2003. In terms of number also, hedge funds have risen. At the end of 2003, there were 480 hedge funds and out of which, 97 were new launches; and in 2004, already 100 new hedge funds have been launched, Ms Murphy said.

However, she said still 85 per cent of the assets under management is managed by less than 15 per cent of hedge fund population.

Meanwhile, in a separate session on private equity, fund managers of private equity funds said there is huge growth in sectors such as retail, multiplexes and media.

According to Mr Vikram Nirula of GM Capital Private Ltd, there is high double-digit growth in sectors such as retail, multiplexes and media. He said these sectors are very big in developed market and there are opportunities in India also.

On their investment in listed companies in India, Mr Nirula said there are large number of listed companies, which in true sense should not be listed. But, he said, they invest in companies, which have good growth prospects and can add value to the company's business. "We are not passive investors but actively involved in management of the company's business," Mr Nirula said.