Maharashtra leads in private equity investments in FY24 while overall investment drops

Maharashtra has emerged as the top state, surpassing Karnataka in total money flow for the fiscal year 2023-24 in terms of private equity investments (PE funds) in India. In 2022-23, Karnataka has topped the list for maximum PE investments in the state.

Mumbai, the financial capital of India, has clinched the spotlight by becoming the leading city for investments after receiving an investment of $7.3 billion, according to a report titled 'India Invests' by Wealth 360 One. Maharashtra, Karnataka, Haryana, Delhi, and Tamil Nadu are the top five states to attract substantial investments from private equity funds.

In terms of cities, Mumbai, Delhi NCR, Bengaluru, Chennai, and Pune are the top cities that attracted the most PE investments. However, the investments in FY24 are up to 30 per cent less as compared to FY23 in most of the states. The experts have attributed the decline to reduced investment in Indian startups.

Mumbai has surpassed India's Silicon City Bengaluru in attracting PE funds, as startup funding has substantially lowered in FY24. As per the Ministry of Commerce and Industry data, India houses 1.7 lakh registered startups, collectively generating over 1.2 million jobs. Maharashtra leads with 5801 startups, followed by Delhi NCR with 3150, Karnataka with 3032, and Tamil Nadu with 2810 startups.

PE funds investing in the $100-250 million range are down by 60 per cent. While those investing $500 million or more have gone down drastically by over 80 per cent. The funds that are investing less than $100 million have also registered a decline of 30 per cent. Despite facing a slight decrease in total value, Bengaluru, India's renowned tech capital, remains a major player, securing the third position in terms of investment value with $2.8 billion in FY23-24.

Chennai has made a remarkable entry into the top cities list, displacing Hyderabad, with an impressive investment of $1.5 billion. Delhi NCR has solidified its position as the second-top destination after Maharashtra, attracting investments worth $4.8 billion in FY 23-24. However, states like Delhi and Haryana, housing Gurugram, witnessed slower deal activity compared to Maharashtra and Karnataka. However, Tamil Nadu showcased positive growth trends, signaling a promising outlook for private equity investments totaling $1.5 billion in the state during FY 23-24.

The report sheds light on the reshuffling observed among the top five states, with Tamil Nadu making a notable entry, displacing Telangana to claim the fifth spot in terms of volume.

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