PE deals grew 36% y-o-y in January this year

PE investments in India has witnessed 36% growth in value terms at $1,325 million on account of increased follow-on investment rounds in January 2019 against $976 million during the same month last year, according to a report.

Grant Thornton’s monthly PE Dealtracker said that the PE deal activity in January this year recorded four deals estimated at over $ 100 million each thus making it about 58% of the total deal value against one such investment in January 2018.

However, compared to December 2018, the PE deal values in January 2019 fell by 39% primarily on account of Swiggy’s $1 billion funding. Excluding this deal, the investment values remained on par with the level recorded in December 2018. However, volumes saw 10% decrease over last month, the report added.

“The growth in the value of PE/VC investments (36%) in January 2019 as compared to January 2018 is primarily because of the number of large-ticket investments, which increased from $ 11.62 mn in January 2018 to $ 23 mn in January 2019. An increase in large ticket investments also reflects the rise in confidence of the investors and strengthening the role of PE/VC fraternity ,”said Pankaj Chopda, Director, Grant Thornton India LLP.

Focus in the current month was primarily on start-ups, IT and ITES, e-commerce and banking and financial sectors for PE/VC investments, he said adding that real estate, infrastructure, pharma, healthcare and biotech, and manufacturing are expected to be of interest based on the announcements in the Union Budget 2019.

Notable trend witnessed wasrecording of 18 investments in the Series A and above funding round constituting 56% of the total volumes in January this year against only 13 such investments recorded in January 2018. The PE Dealtracker also states that e-commerce and start-up sectors saw maximum investments (13 deals of 18 deals) in ‘Series A and above funding round’ category.

The report further says that in January investments in start-ups contributed to more than half of the total investment volumes valuing at $ 158 million. FinTech segment got significant attention from investors with seven deals followed by travel and logistics space with six deals together capturing 47% of the volumes within the start-up sector. Banking, IT and e-commerce sectors remained impressive, garnering big-ticket investments valued over $ 100 million.