BlackRock chases private credit deals in record India market

BLACKROCK, the world’s largest asset manager, is hunting for Indian direct lending opportunities in a broadening array of sectors from agriculture to hospitality as the nation’s booming private credit market lures more borrowers.

There are openings to lend to large enterprises with multiple subsidiaries as well as young entrepreneurs funding start-ups, said Celia Yan, BlackRock’s head of APAC private credit at a media briefing last week.

India is a bright spot for private credit in Asia as Prime Minister Narendra Modi’s ambitious growth targets and deregulation initiatives spur increased funding needs of local firms. Private credit investments in India in the the first six months of 2024 soared to an all-time high of US$6 billion, according to a recent report by EY.

The US$1.7 trillion private credit market has ballooned globally since the global financial crisis and lenders including Blackstone expect it to continue to grow, even as some investors warn of headwinds because of slowing economies and elevated interest rates. Globally, BlackRock is racing to catch up to competitors in private credit and chief executive officer Larry Fink has highlighted the area as a “primary growth” driver for the firm.

One advantage of India’s competitive private credit market is the ease with which lenders can exit transactions, as there’s a large number of financiers willing to take on refinancing risk, she said. BLOOMBERG