Meet GQG Partners, a global investor that bets $1.87 billion on beleaguered Adani Group

Jugeshinder (Robbie) Singh, Group CFO of Adani Group, said: “We are delighted to complete this landmark transaction with GQG. We value GQG’s role as a strategic investor in our infrastructure and utility portfolio of sustainable energy, logistics and energy Transition. This transaction marks the continued confidence of global investors in the governance, management practices and the growth of Adani Portfolio of companies.”

Below is a close look at the firm which is now the cynosure of attention in market circles and India Inc thanks to the timely 'confidence capital' offered to the Adani conglomerate.

What exactly is GQG Partners?

GQG is one of the world’s leading Global and Emerging Markets investors which manages more than $92 billion in client assets as of January 31, 2023. Its available investment vehicles range from separately managed accounts and private funds to US mutual funds.

What is its strategy?

Driven by client-alignment, GQG has delivered strong long-term investment results across its core strategies. According to the firm's latest annual report, those strategies are Global Equity, International (non‑US) Equity, Emerging Markets Equity, and US Equity. These core strategies hold stocks from 15‑80 issuers, the report added. Incidentally, GQG was awarded the Morningstar Fund Manager of the Year (Global Equities) for 2023.

Where is it based?

The asset manager is headquartered in Ft. Lauderdale Florida, with offices in New York, London, Seattle and Sydney. It is listed on the Australian Securities Exchange and majority owned by its employees. GQG Partners was the largest IPO on the ASX in 2021, raising $1.187 billion and listing with a $5.91 billion market capitalisation.

Who are the people behind GQG Partners?

The firm was founded by Rajiv Jain in June 2016. He is also the Chairman and CIO of GQG Partners. "I bought my first stock in high school and I have been managing other people's money for over 22-23 years," Jain says in an introductory video on the firm's website.

Also Read: Adani Green Energy's 22.5 million shares bought by Goldman Sachs Fund in block deal

Prior to GQG, Jain served as the Co-Chief Executive Officer (from July 2014) and Chief Investment Officer and Head of Equities (from February 2002) at Vontobel Asset Management, where he worked for nearly 22 years. Prior to that, he was an International Equity Analyst at Swiss Bank Corporation. Jain, who was born and raised in India, earned an MBA in Finance and International Business from the University of Miami.

What's Rajiv Jain's investment mantra?

"Our goal is quite simple: to compound our clients’ capital over time. To do this, we need to protect assets in difficult markets and participate in rising markets. We have developed an investment approach that strives to do just that, based on a lens we call Forward Looking Quality. This concept ignores the traditional investment constraints associated with growth and value and instead focuses on investing in companies that we believe are going to be successful over the next 5 years and beyond."

Here's more from Jain who has steered GQG's aggressive shift from technology bets...

In a February 2022 interview with the Financial Review, Jain said, “Remember what Chuck Prince said in 2007: you’ve got to dance when the party’s on,” Jain says. “But our view is you can’t wait till the music stops; you’ve got to make some preparations. Technology is no longer the next growth spot; it’s yesterday’s growth spot.”

The article added that Jain is most bullish on the energy sector because of the underappreciated necessity of fossil fuels in the transition to a net zero economy. Now with the Adani group's pivot towards renewable energy and green hydrogen, guess GQG's mega block deals make perfect sense!

Alright, who else is part of the A team?

Tim Carver is the CEO of GQG Partners and he has built boutique investment firms for over 15 years. In earlier stints, he had co-founded Northern Lights Capital Group (now Pacific Current Group). Prior to co-founding Northern Lights, Carver was a co-founder of Orca Bay Partners, a private equity firm where he developed a practice area focused on capitalising boutique investment firms. He began his career at Morgan Stanley in their New York analyst program and graduated with honours from Harvard College.

What's GQG's investment split across the Adani Group?

From the combined investment amount of Rs 15,446 crore, Rs 5,460 crore went to Adani Enterprises, Rs 5,282 crore to Adani Ports and Special Economic Zone Ltd, Rs 1,898 crore to Adani Transmission and finally Rs 2,806 crore to Adani Green Energy.

Why this investment is not really a surprise

In a February 2023 interview with Bloomberg TV, Jain was asked if the India story looks as healthy post-Adani as it did before, and he said, "In our view, nothing has changed. I think from an Adani perspective, there is a lot of hot air in my opinion. First of all the banking system is fine because the exposure is under 1 percent overall system wide, so I think it's fine. The second thing is these are regulated assets...you can verify a lot of these revenue streams from other places. So I think this is not Enron or Satyam for that matter. From a  system perspective, we are not concerned. Obviously, Adani specifically is a different call to make. "

And guess what, a week later, GQG did make that call after all!