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64 KUMPULAN WANG PERSARAAN (DIPERBADANKAN) FoR BEttER PERFoRMANcE

INVESTMENT REVIEW
ASSET CLASS REVIEw

Majority of KWAP’s private equity exposure is focused in The commitment towards 67 funds and four direct
the North American region. The Infrastructure portfolios investments as at 31 December 2022 is continually
are also marginally more present in North America than enhanced through strategy diversification within private
in Europe. The basis for the exposure is due to said
regions’ housing more developed markets offering equity and infrastructure portfolio. KWAP strategically
investors numerous opportunities to invest in high-growth focused the majority of its private equity fund programme
companies across various industries and sectors. The on a mid-buyout strategy, aimed at investing in
North American market is particularly attractive to investors companies with strong growth potential. This approach
as an incubator for new developments in technology, has allowed KWAP to achieve higher returns with a
life sciences and service-based industry as well as its relatively lower risk profile, with returns netting an IRR of
transparency and strong intellectual property regulations
for investors. Additionally, the region has a well-established 22.0% and MOIC of 1.5 times.
and mature private equity industry with a track record of
generating attractive returns for investors. Additionally, this strategy helps KWAP to diversify its
underlying fund’s portfolio across different sectors
Europe’s thriving private equity market continues to namely information technology (26%), industrial (15%),
attract investors from around the world, and KWAP was healthcare (13%), consumer (8%), financial services
no exception. The region’s developed market economy,
strong legal framework, and diversity in cultures and (8%) and others (30%).
expertise provide a secure and profitable investment KWAP’s secondary strategy on the other hand, recorded
climate. In 2022, KWAP continued its successful track
record in Europe across six fund commitments; focused the highest return with a net IRR of 25.7% and a net
on the buyout, infrastructure and venture capital sectors, MOIC of 1.7 times. Secondary strategies involved
providing diversification across key investment areas. investing in matured funds designed to mitigate the effect
of the J-curve. This strategy allowed KWAP to benefit from
Private Equity and Infrastructure Exposure based on the high cash distribution generated by these matured
2022 Strategy
funds. By acquiring interests in these matured funds,
Private Equity KWAP could then gain access to a diverse range of
established investment opportunities that have a proven
10.3%
track record of generating consistent cash flows.

18.7% In 2022, KWAP made its first investment into the
core-plus infrastructure space, through a fund manager
with the ability to generate top-quartile returns,
11.8% 59.3% complementing KWAP’s earlier infrastructure investments
in the value-added and opportunistic space. A selective
• Mid Buyout • PE - Growth expansion into core-plus provides diversification to
• PE - Secondaries • PE - Venture Capital KWAP’s infrastructure portfolio and offers more stable
Infrastructure returns under challenging economic conditions, as
14.0% assets have a stable risk-return profile with features to
limit fluctuation risks, such as long-term contracted,
inflation-linked revenues with steady regulatory and
government support.
86.0%

• Value-add / Opportunistic • Core / Core-Plus