3i Infrastructure struggles in India

While 3i Infrastructure's European portfolio performed well in the year to March 31st, the infrastructure investment firm did highlight a more challenging environment in India.

Portfolio income amounted to £73.1m during the 12-month period which fully covers the group's dividend distribution objective of 5% of opening net asset value (NAV). The firm invested a total of £202.9m during the year, while generated realisation proceeds of £132.6m.

The European portfolio is said to have performed well and continues to deliver a good yield, with Eversholt Rail Group performing particularly strongly.

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However, the group's India Infrastructure Fund has been hit by a depreciating Indian rupee and a 21% fall in the share price of Adani Power Limited since the end of September.

"As usual, an important element of the determination of the results for the year to 31 March 2012 will be the valuation exercise carried out on the investment portfolio as at that date," the group said.

As at March 29th, the firm had cash balances of £171.8m, compared with £136m on January 24th, reflecting investment activity, the conversion of 19.4m warrants and income receipts from the portfolio.

"3i Infrastructure's European portfolio continues to perform well. Market conditions in India, however, have been more challenging. Overall, the portfolio has continued to generate strong income," said Chairman Peter Sedgwick.

BC