Subahoo Chordia, President and Head of Real Assets at Edelweiss Alternatives, joined Giovanni Amodeo for a fireside chat to discuss the energy transition investment theme across asset classes.

Background and Career: Chordia has 25 years of experience in the industry, starting with IDBI in 2001. He has played various roles within the infrastructure space, including project finance, corporate finance, investment banking, private equity, and asset management. He moved to the asset management side seven years ago to start Edelweiss Alternatives’ real assets business.

Energy Transition Investment Theme: Chordia emphasized the importance of asset management in infrastructure and energy transition investments, which have a long-term horizon of 25 years. He highlighted three key themes in India: decarbonization, India’s manufacturing and consumption growth, and India’s digitization and urbanization.

Decarbonization: India’s energy consumption growth rate is 6-7% per annum, which requires the addition of 45,000-60,000 megawatts of renewable energy capacity every year. The government has implemented various measures to support decarbonization, such as solar parks, which reduce risk and execution timelines.

India’s Manufacturing and Consumption Growth: India’s manufacturing and consumption growth are driving demand for infrastructure, including highways and commercial offices. The government has implemented initiatives such as InvITs (Infrastructure Investment Trusts), which provide a favorable exit vehicle for investors.

India’s Digitization and Urbanization: India’s digitization and urbanization are leading to significant growth in the service sector, driving demand for commercial offices and other infrastructure assets.

Risk-Adjusted Returns: Chordia emphasized the importance of risk-adjusted returns, which have improved in India over the last 7-8 years due to various government initiatives. He highlighted the need to factor in the cost of team management and capacity building to achieve scale and efficiency.

Key timestamps:

00:09: Introduction to ION Influencers’ Fireside Chats
01:29: Transition from Investment Banker to Asset Manager
03:54: Energy Transition Investment Theme and Long-Term Sustainability
06:17: Macroeconomic Thesis for Energy Transition Investment
10:29: Impact of InvIT Structure on Investment Trusts
13:46: Metrics for Evaluating Infrastructure Investments
16:29: Identifying Red Flags in Infrastructure Investments
18:05: Building and Evaluating the Management Team
20:10: Highway Sector Trends and Economic Models
22:53: Innovations in Highway Models
23:48: Technological Innovations in Highways
24:27: Digitization and Operations in India
26:15: Global Companies in India
27:12: India’s Growth Potential
28:11: Occupancy and Rentals in India
29:14: Quality of Assets and Demand
31:53: Consolidation in Asset Management
33:12: Investment Strategy