Private equity and venture capital investments touched a record USD 11.2 billion in the first half of this calender year, a 41 percent rise over last year on the back of big ticket deals, says a report.
According to business consultancy firm EY, during the January to June period of this year PE/VC investments stood at USD 11.2 billion, the highest ever investments during the first six months of a year.
In the January-June 2016, PE/VC investments stood at USD 8 billion.
“India is clearly maturing as a PE market with bigger and more complex deals becoming more common place. Greater numbers of big size deals and buyouts are both a testament to this and it is clearly visible in the first half of 2017 investment numbers,” EY Partner and Leader for PE Mayank Rastogi said.
The January-June period recorded 26 deals of value USD 100 million and above, aggregating to USD 7.7 billion and accounting for 68 per cent of investments during the period.
Rastogi said the blockbuster exits have also helped PE funds reaffirm their India thesis.
Exits recorded a year-on-year increase of 53 percent by value and 50 percent by volume at USD 4.8 billion across 129 deals, driven by record exits by way of open market and secondary exits.
“PE owned companies are globally known to drive greater revenue and margin growth leading to a multiplier effect on their larger eco-systems. There is massive amount of dry powder available globally and most global funds are keenly looking for investment opportunities in India,” he said.
From a sector perspective, financial services, technology and real estate were the leading sectors in terms of investments in the first half of this year.
Financial services recorded USD 3.4 billion across 51 deals — the highest half yearly numbers recorded by any sector in over a decade, mainly due to the large USD 1.4 billion Softbank’s investment in Paytm, the report said.
Technology recorded USD 1.9 billion across 69 deals in the first half of this year, while e-commerce investments declined further after recording muted performance in 2016.
At USD 617 million across 26 deals, investments in e-commerce fell 42 percent in value and 51 per cent in volume terms in the first half of this year compared to last year.
The report further noted that the first half of this year saw significant activity from Canadian pension funds who have been involved in some of the larger investments made during the year. In aggregate, they invested more than USD 2 billion across six deals in 2017, the report said.