PE investments in India fell 25% sequentially in April-June quarter: Refinitiv

Private equity investments in India declined 25.1 per cent sequentially to $6.7 billion in April-June 2022 from a level of $8.98 billion in January-March 2022. 

Even on a year-on-year basis, PE investments fell 17.3 per cent against $8.13 billion recorded in April-June 2021, data with Refinitiv, an LSEG Business, showed. 

Total number of deals in April-June 2022 dropped 14.9 per cent to 344 compared with 404 deals in January-March 2022 but grew 6.5 per cent compared to the 323 deals in April-June 2021.

However, for the first half this calendar year, PE investments in India was up 25.9 per cent at $15.7 billion ($12.48 billion). The number of deals, too, surged 22.4 per cent at 748 compared with 611 in the first half last year.

Elaine Tan, Senior Analyst, Refinitiv, highlighted that internet-specific and computer software companies continued to take up majority of the activity, accounting for 73.2 per cent of the private equity investments in India so far this year. 

“Value creation through digital transformation and increasing depth in India’s innovative start-up ecosystem continues to drive activity. There is also substantial capital waiting to be deployed as India-based PE funds raised $7 billion so far this year, more than double the amount raised from the first half of last year, pushing fundraising activity to more than $24 billion from 2019 to first half of this year,” Tan said.

Part of the reason for the decline in PE investments into India in April-June are factors such as geopolitical tensions, rising global interest rates besides the fact that PE investors have world has become a bit cautious on the valuations front,
Tushar Sachade, Partner,Pricewaterhouse& Co LLP, told BusinessLine.

Industry-specific investments

In terms of industry-specific investments, Internet-specific companies continue to attract maximum Private Equity interest with $6.53 billion invested in H1 this calendar year. Computer software saw PE investments of $4.96 billion spread over 261 deals. This was followed by a transportation which saw PE investments of $1.26 billion over 24 deals.

The other sectors that saw robust PE investment interest include financial services, consumer related, medical/health and computer hardware.

Fundraising in India

Private equity fundraising activity in India during the first half of 2022 stood at $ 7.03 billion, up 165.9 per cent  over $2.64 billion in same period last year.

Fundraising activity for funds located in India has seen a 158.7 per cent increase to $2.63 billion in April-June 2022 from $1.02 billion in same quarter last year and fell 40.3 per cent over $4.4 billion recorded in January-March 2022, according to Refinitiv. The number of companies invested in first half this calendar year stood at 113 (179).

Top 10 investments

The top ten PE investment deals in H1 2022 in India in terms of equity invested are VerSe Innovation ($827.7 million); Think &Learn ($800 million); Bundl Technologies ($700 million); Tata Motors Electric Mobility Ltd ($494.7 million); NTEX Transportation Services ($330 million); Delhivery ($304 million); Busybees Logistics Solutions Pvt Ltd ($300 million); EQX Analytics ($270 million); Mohalla Tech ($255 million) and Acko Technology & Services ($255 million).

Published on

July 11, 2022

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