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Private equity and venture capital investments in India have surpassed the $15-billion mark in the first half of this calendar year, an increase of 46 per cent over the year-ago period, the EY private equity deal tracker showed.
Buyouts emerged as the strong driver for this growth.
PE/VC investments in January-June period stood at $15.2 billion across 351 deals, on the back of 36 large deals of value greater than $100 million, strong buyout activity and investments in infrastructure and real estate asset classes.
The first half of the year saw the highest value of buyouts ever at $4.9 billion, accounting for 32 per cent of all investments received in this period.
Exits were to the tune of $5.5 billion across 99 deals, on the back of a few large strategic and secondary exits even as the open market transactions remained subdued on account of volatility in the stock markets.
Commenting on the PE landscape, Vivek Soni, Partner and National Leader Private Equity Services, EY, said, “PE/VC investment activity in India has continued its strong performance in 2018 (despite global headwinds) with both investments and exits exceeding the numbers recorded in the first half of 2017. Buyouts as a theme has become even stronger in 2018 and is on course to become a prominent facet of PE investing in India”.
Global headwinds
Notwithstanding headwinds like high oil prices, depreciating currency and potential of global trade winds, the first half year performance on PE/VC investments, exits and fundraise has been strong and appears to be well on course to surpass the record highs of 2017, Soni said.
In fact, 2017 was one of the best years for PE and VC activity in India with flows to the tune of $26.4 billion, much higher than the $16 billion level seen in the previous calendar year.
Soni also said that the entry of large pension funds looking to invest directly into yield generating assets has provided a significant impetus to investments in the infrastructure and real estate classes. All these are in line with the trends EY had forecasted in its PE/VC India Trendbook 2018 released earlier this year, he said.
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