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Project4 IBEP
Project4 IBEP
Buyback
Introduction
Private equity funds exit strategy can significantly impact the return on
investment. Irrespective of the exit strategy, exits are becoming more demanding.
The growing technological enhancements make it hard for sellers and buyers to
reach a common understanding regarding risks and potential sources of value.
When the basic valuation gears are pulled, owners find it difficult to generate
profit after one to three years of holding. Such issues make the exit process more
difficult to accomplish effectively, resulting in a wider spread between weak and
strong exits. The potential to enhance performance is determined by the market
situation and the type of valuation gears pulled. Whereas the organization's
primary focus should be on pulling the value levers that have an instant effect, it
should also strive to identify supplementary, long-term value creation
opportunities. This report analyzes the Kotak Realty Fund exit from Lodha's
Palava City.
Valuation
CAGR 19.22%
From above calculation, it is cleared that the rate of return for Kotak Realty Fund
is around 19.22%.
Conclusion
Kotak had committed a total of $ 356 million with the goal of investing in
Structured Credit in the Indian real estate market. The funds were spread across
various properties in Chennai, Mumbai, NCR, and Bangalore. Kotak has now
completely closed four funds as a result of the full exit of this account. Across
investments, the latest Fund generated a Rate of Return of 19.22 percent. This
reaffirms Kotak's leadership position and demonstrates performance in difficult
market conditions. Kotak has once again distinguished itself by ensuring full
exits from all investments in these difficult market conditions. With this incident,
Kotak lost its confidence of investing in the Indian market. India being one of the
strongest economic nation still has some block holes due to which investors don’t
gain the courage of investing in the Indian market, another example of it can be
the unsuccessful LIC IPO.