Private equity investments into India fell 75 per cent in January-March 2023 at $2.2 billion ($8.8 billion in January-March 2022). On a sequential basis, the PE investments was down 32 per cent over the level of $3.2 billion recorded in October-December 2022, showed the latest data from Refinitiv, a global provider of financial markets data.

The number of deals in Q1 2023 decreased by 19.9 percent to 282 compared to the previous quarter of 352 in Q4 2022 and by 30.9 per cent compared to the 408 deals in Q1 2022.  

Elaine Tan, Senior Analyst at Refinitiv, said that private equity investment of $2.2 billion in January-March 2023 is the lowest start to a year by value for PE investments in India since 2018 ($1.7 billion).

Also read: PE, venture capital investments dip 42% on high valuation

India’s private equity investments saw its sixth consecutive quarterly decline during the first quarter of 2023 as global macroeconomic and geopolitical headwinds drove caution in investment activity, Tan added.

Read more: PE investments fell 33.1% in Jan-Sept 2022

Tan said that India’s robust start up ecosystem makes it an increasingly attractive destination for investments and companies seeking to access the Asia Pacific markets beyond China.

With turbulent market conditions and uncertainty, private equity fundraising activity in India also fell 41 per cent this year compared to the first quarter of 2022 and saw a 45 per cent decline from the fourth quarter of last year.

Computer Software  and Internet-Specific companies continue to attract maximum PE interest with $392.3 million and $870.9 million invested in Q1 2023.

On industry-specific investments, Internet-Specific, Computer Software and Consumer-Related have seen the maximum investments coming in Q1 2023. The sum of equity invested in the software sector have decreased by 85.2 per cent, with number of deals declined to 88 ( Q1 2023) from 123 (Q1 2022)