KIC to focus on tech ventures, private debt, infrastructure

Korea Investment Corporation (KIC) will continue to look for opportunities in private debt and venture capital investment with mid- to long-term growth potential, the South Korean sovereign wealth fund’s CEO Jin Seoungho said in his keynote speech on Oct. 26 at ASK 2022, The Korea Economic Daily’s biannual conference on alternative investment.

The world’s 14th-largest sovereign wealth fund, managing $205 billion in assets as of end-2021, allocates 17.5% of its assets to alternative investment and is aiming to raise that proportion to 25% by 2025.

The institutional investor is accelerating tech venture investments via its KIC Venture Growth Fund, as well as strengthening partnerships with tech-specialized asset managers, Jin said.      

At the same time, KIC will have a more careful approach to new investments considering funding risks, the CEO said. For a steady stream of cash flow amid interest rate hikes, the institutional investor will expand its private debt strategies, he added.    

KIC is also planning to increase exposure to infrastructure as the asset class hedges inflation. The sovereign wealth fund is particularly paying attention to fiber cables, telecommunications towers and data centers as well as green infrastructure associated with ESG factors.

It will continue to ramp up investment in renewables, transportation such as modernization of toll roads, ports and airports and transformation to electric vehicles as well as residential and other living infrastructure.

The sovereign wealth fund is looking for real estate opportunities in multiple sectors and regions, as well as focusing on rebalancing and new investments in hedge funds, an asset class with low correlation to market volatility. 

KIC expects its alternative assets to enhance the diversification of its portfolio and will gradually expand exposure to these assets with more efforts in vintage risk management, the CEO said. 

Write to Jihyun Kim at snowy@hankyung.com
Jennifer Nicholson-Breen edited this article.