According to a recent report furnished by multinational professional services firm EY, private equity and venture capital (PE/VC) investments in the Indian subcontinent have reached a record USD 11.2 billion in the first half of this calender year. This means, the country witnessed a whopping 41 per cent increase over last year courtesy some big ticket deals.

The EY report revealed that PE/VC investments from January to June this year were locked in at USD 11.2 billion, which is the highest ever investments recorded during the first six months of a year. The PE/VC investments recorded for January-June 2016 was USD 8 billion.

Commenting on the report's findings, EY Partner and Leader for PE Mayank Rastogi said, "India is clearly maturing as a PE market with bigger and more complex deals becoming more common place. Greater numbers of big size deals and buyouts are both a testament to this and it is clearly visible in the first half of 2017 investment numbers."

According to the report, the January-June period witnessed a total of 26 deals of value USD 100 million and above, aggregating to USD 7.7 billion. This made up for 68 per cent of investments during the period.

Rastogi believes that blockbuster exits registered in the Indian startup sector might have played a significant role in reaffirming private equity funds confidence in their India thesis.

The report highlighted that the Indian startup sector saw an year-on-year increase of a good 53 per cent in value and 50 per cent in volume at USD 4.8 billion across 129 deals. This was courtesy record exits paved by open market and secondary exits.

Rastogi further noted that private equity owned companies have acquired a global reputation of driving greater revenue and margin growth leading to a multiplier effect on their larger eco-systems. "There is massive amount of dry powder available globally and most global funds are keenly looking for investment opportunities in India, " said Rastogi.

The report also found out that the first half of this year recorded a lot of action from Canadian pension funds who have been involved in some of the larger investments made during the year. They ended up investing more than USD 2 billion across six deals in the year gone by so far.

According to the EY report, financial services, technology and real estate sectors were the leading sectors in terms of investments in the January-June this year report.

While financial services saw USD 3.4 billion across 51 deals, technology recorded USD 1.9 billion across 69 deals. Softbank's USD 1.4 billion investment in Paytm played a crucial role in raising the stakes of the Indian financial services sector. Unfortunately, ecommerce investments saw another period of disappointing performance after a not so eventful 2016.

According to the report, with USD 617 million across 26 deals, Indian ecommerce investments decreased from 42 per cent in value and 51 per cent in volume terms in the January-June period of this year compared to the same period last year.

Post a Comment

Previous Post Next Post
Like this content? Sign up for our daily newsletter to get latest updates.