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Our Bureau

New Delhi , Nov. 6

Private equity firms are on a roll in India. The period between January and October this year saw 230 private equity deals valued at $5.93 billion. This represents a 250 per cent increase on an annualised basis over the $2.03-billion invested in 2005.

The value of private investments in 2005 saw an 85 per cent growth over the $1.1-billion investment in 2004, according to the latest deal tracker issue by Grant Thornton.

Further, there were 45 private equity deals in September and October 2006 valued at $1.43 billion.

In terms of sector focus, IT & ITES has got the maximum number of investments in both 2005 and year-to-date (YTD) 2006 with 50 deals during YTD 2006. The other sectors which have been volume drivers are real estate and infrastructure; banking and financial services; pharma, healthcare & biotech; and manufacturing.

In YTD 2006, the sector that garnered the maximum value is IT & ITES at $1.46 billion. Most of this investment has been from a single transaction, 85 per cent acquisition by KKR of Flextronics Software Systems for $900 million. The other key sectors which have been value drivers are real estate and infrastructure; banking & financial services; and telecom.

According to Grant Thornton, the last two to three years have also witnessed several private equity exits in the Indian market. These have been through several modes such as open market sale/block deals such as Warburg Pincus' sale of stake in Bharti Televentures; trade sale/sale to strategic acquirer such as BPEP India's sale of stake in Mphasis-BFL to EDS, Newbridge and Temasek stake sale in Matrix Laboratories to Mylan Labs.

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