Ravi Suria, a former Wall Street star-turned-entrepreneur, is all set to float a $500 million hedge fund on July 1.
Five years ago, Suria -- then a bond analyst at Lehman Brothers -- became an overnight star on Wall Street after he came out with a shocking 27-page indictment on e-tailer Amazon.com portraying it as a company which did not have enough money to survive.
Suria's New York-based company Valmiki Capital Management, will allocate the largest portion of its funds for investment in the United States and will also look at investing in India also. The fund will primarily buy and sell equities.
According to market sources, Suria's fund will have an India focus too with ". . . the Indian marketplace going to be one of its favorite secular equity themes globally."
It is anticipated that close to 50 per cent of the foreign money coming into the Indian market is through participatory notes (PNs), which locally registered foreign institutional investors issue to the hedge funds.
Differing from mutual funds, which have a 'buy and hold' strategy, hedge funds move in and out of markets fast, anticipating market changes and cashing in on such opportunities.
Suria, who quit Lehman to join investment advisory firm Duquesne Capital Management as managing director, is apparently tilted towards countries like India where a larger percentage of the populace is younger and hence increasingly more productive.
Suria was a star in the making when he predicted the global telecom meltdown much earlier than others. Suria's premise was simple and deadly accurate when he pointed out that the return on capital invested in the telecom business was lower than the weighted cost of capital, and the sheer size of debt that the industry had taken on its balance sheet would.
An e-mail to Suria for confirmation of this story elicited no response.
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