CPP Investments to invest C$130 bn in green energy transition projects.

CCP Investments, the global investment management organisation that invests surplus funds of Canada Pension Plan, intends to double its Canadian $67 billion investment in global green energy transition projects and scout for investment opportunities in the pharma and healthcare sector in India.

As the world moves toward net zero, the fund house aims to manage the investment risks and support value-creating opportunities that will arise as society works to remove greenhouse gas emissions from the whole economy.

John Graham, President & CEO, CPP Investments, in a discussion with journalists said the fund house will continue to invest and exert influence in the whole economy transition as active investors, rather than through blanket divestment

Led by investments in battery making and charging infrastructure, CCP Investments expects its C$67 billion investment in green and transition assets to touch at least C$130 billion by 2030, he said.

The pharma and healthcare sector, which had hogged the limelight after the Covid, had so far not attracted any investment from the fund house. “We had not looked at the potential of pharma as an investment opportunity but now the sector is very attractive. We are exploring for the right company with right price for investment,” said Graham.

The fund house manages C$19.6 billion (about ₹3 lakh crore) of investments in India, which accounts for 3.6 per cent of its total asset of C$550.4 billion as of last December-end. CPP Investments is also exploring opportunities in the National Monetisation Pipeline and National Infrastructure Pipeline and had a meeting with government official last week.

The national infrastructure pipeline is a ₹111 lakh crore development fund for energy, transportation and urban development infrastructure projects. Its seeking to secure ₹23 lakh crore from institutional investors. The national monetisation pipeline aims to fund government-owned infrastructure projects, valued at about ₹6 lakh crore.

The global investments of the fund house had generated revenue of C$351 billion over last 10 years. The rate of return in the December quarter of fiscal year 2022 was 2.4 per cent. The five and 10-year net return was at 11.7 per cent and 11.6 per cent, respectively.

The fund’s return was not impacted much by the Covid pandemic in last two years due to diversification across sectors and long-term nature of investments. In fact, Graham said there were some interesting investment opportunities globally with asset price crash in specific sectors. The fund house’s returns were not impacted by the ongoing geo-political tension in Russia and Ukraine as it did not have much investments in those countries.

HBL