India A Bright Spot For Otherwise Insolvent CalPERS

I heard that Calfornia Pension is going to default and I started wondering what could be India's contribution to that.

First the loosing money part: To indemnify myself

According to a study by the Standford Institute For Economic And Policy Research and as reported by Forbes and Business Insider, there is a 82% chance California Pensions will runout of money.

The study, conducted by Stanford Professor Joe Nation along with California Common Sense, covered all three of the state’s largest pension systems: CalPERS (California Public Employees' Retirement System), CalSTRS (California State Teachers' Retirement System) and UCRP (University of California Retirement Plan.)

Calpers, which is the largest among the three has an exposure $34.2Bn to Global Private Equity and about $22.1Bn to global real estate.

Next looking at how's it doing in India part:

Here is the snapshot of Calpers asset allocation as on September'2011.



Of this about $900Mn is committed to Funds for investments in Indian Private Market

Have a look



Over the years, the pension fund has also taken direct positions in Indian equities. Some of it's investments include ICICI Bank, Allahabad Bank, Adani among others.

And how are they doing?

According to the 2010 Annual report of CalPERS the book value of their exposure to PE Funds investing in India is $868Mn while the market value is close to $920Mn. But that was for 2010.

As for the book value I would leave it to esteemed readers to assess based on the list above and markets today., how they could be doing now?

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1

January 03, 2012 08:11 PM

Dear Editor, This is fantastic analysis. I live in west . Whenever I come to India , I am surprised to see how unqulified, uneducated real estate guys flaunt their money . I am shocked to see the villas in Bangalore priced at 2-3 million USD artificially jacked up by these fund managers who are hand in hand with these real estate guys. Now I know it is the money of hard working western people who save their money for rainy day. - Posted by Ram Recommended by 0 Readers