Moneycontrol.com – The “Meltdown May” may have severly impacted hedge funds in general, but there is no stopping them from looking at the India story. From GDP recording growth of 9.4% in Q4 to Sensex looking to outperform most other emerging markets of the world, India appears to have all the necessary ingredients to lure global hedge funds back from their temporary retreat.
Although India does not have a Made in India hedge fund at the moment, a number of India and Asia centric hedge funds have been operational. There are various estimates on the number of overseas hedge funds already active in India. Global data bankHedgeFund Intelligence estimates around 20 India-specific hedge funds and about 700 Asia-directed hedge funds with direct or indirect exposures in Indian stocks. According to a report on the Indian Hedge Funds Managers conference in Geneva last month, there has been a renewal of interest in India-only hedge funds in the recent months and the new additions put the current figure at around 50.
But Deven Choksey of KR Choksey who attended the conference believes it’s very difficult to figure out which hedge funds are making profits and how much as their operations are very opaque in nature. “They don’t share such information unless one is an investor with them. Unfortunately, there are not many people from the India side who invest in these hedge funds,” he said.
However, experts believe that total hedge fund assets flowing into the Indian market has doubled from $2 billion in 2003. According to AsiaHedge, part of the HedgeFund Intelligence group of publications, hedge fund assets directed towards Asian equities almost doubled to nearly $115 billion in 2005 from about $60 billion. India (hedge) funds were continuing to clock solid growth in the early part of 2006, it said in February this year.
