Private equity and venture capital (PE/VC) investments rose 64 per cent to $8.3 billion across 266 deals during the first quarter of calendar year (January-March), on the back of 22 large deals worth $4.8 billion. For the comparable quarter a year-ago, PE/VC investments stood at $5.1 billion.
On a sequential basis, however, investments fell by 55 per cent. In terms of number of deals, the reporting quarter recorded a 19 per cent rise compared to the same quarter a year-ago, and a 10 per cent rise compared to the sequential fourth quarter, according to a report by the Indian Private Equity & Venture Capital Association and EY (IVCA-EY).
The number of PE/VC deals stood at 266 in the January-March period this year versus 223 deals in the same quarter a year ago, and 241 deals in the fourth quarter of 2020.
Large deals fall
Large deals in the first quarter were significantly lower than the previous quarter that had recorded 30 deals aggregating to $16 billion. The largest deals in the Q1 of calendar year 2021 include the $460 million investment in BYJU’s, followed by the $400 million investment in Dream11 by a group of PE/VC investors.
Vivek Soni, Partner and National Leader Private Equity Services, EY said: “The first quarter of 2021 has seen a sequential month-on-month increase in PE/VC investment activity, from $1.6 billion in January to $4.6 billion in March 2021. On a y-o-y basis, investments grew by 64 per cent in Q12021 due to the low base effect as investments in Q12020 were severely curtailed by the growing uncertainty around the spread of Covid-19.”
“The pandemic resilient sectors like pharma, healthcare, edtech, online media, SaaS etc. continue to see good traction in both value and volume of PE/VC deals,” he added.
PE/VC exits have picked up momentum in 2021 with exits worth $4.2 billion getting recorded in the quarter, which is 70 per cent of the total value seen last year.
E-commerce has emerged as a new IPO-intense sector wherein six companies — including Zomato, Nykaa and Grofers — have filed their draft red herring prospectus.
The reporting quarter saw $1.7 billion in fund-raises, 20 per cent higher compared to last year ($1.4 billion) and 56 per cent lower compared to the previous quarter sequentially ($3.9 billion).