India-focused hedge funds, which are now clearly the talk of town, have delivered a return of 19.6 per cent so far this year and are one of the best performing groups of hedge funds in the last five and a half years, says a study by Hedge Fund Net (HFN) — a tracker of such funds. In the last 12 months through July, the average return for India-focused hedge funds was 53.6 per cent, dwarfing the 45 per cent return on the Sensex. Hedge Fund Net, which tracks over 7,000 funds the world over, estimated that the total assets managed by hedge funds investing primarily in Indian markets were at $13.97 billion at the end of the second quarter. This number has moved up five-fold from $2.8 billion in the latter part of 2005, when such investments began to gain a lot of traction. This sharp increase was a likely result of these funds delivering high returns in 2004, says the report. Since the third quarter of 2005, the average cumulative return produced by these funds was estimated over 72 per cent.   more »

Citigroup Inc.’s hedge fund unit Old Lane LP plans toinvest Rs 1.06 billion ($26 million) in India’s KVK Energy & Infrastructure Pvt., as the world’s second-fastest pace of economic growth lures investors. Old Lane, bought this year by Citigroup, may acquire 26 per cent of KVK Energy, which builds power projects, company secretary Ram Mohan said in a telephone interview from Hyderabad, where KVK Energy is based. He didn’t give a timeframe.   more »