Private Equity, Venture Capital Investment In India At $20.5 Billion In 2018: Grant Thornton Report
A HDFC Bank Ltd. teller counts Indian 100 rupee banknotes at the company’s bank branch in Mumbai, India. (Photographer: Dhiraj Singh/Bloomberg)

Private Equity, Venture Capital Investment In India At $20.5 Billion In 2018: Grant Thornton Report

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Private equity and venture capital investments in the country stood at $20.5 billion across 786 transactions in 2018 on account of tech-enabled startups, e-commerce and information technology-enabled services, according to a report by Grant Thornton.

The funding in 2018 was the same as the investment in the preceding year, the assurance, tax and advisory firm said.

"The top trending themes during the year were revival of startups, continued uptick in control deals and larger bets, and increased focus of sovereign wealth funds towards Indian assets. Startups accounted for 59 percent of the total private equity investments recorded in 2018 by values and 26 percent by volume," said Vrinda Mathur, partner, Grant Thornton India LLP.

In terms of the size of investments, the sharp increase in the private equity and venture capital funding was due to 47 deals valued at $100 million or greater, including six deals worth over $500 million. Big-ticket investments were driven by complex deal structures, private equity-backed merger and acquisition, later-stage funding and the inflated startup valuations, it said.

Further, the report said it is not unusual to witness high levels of public spending in election years and it may push investments in rural and infrastructure-related sectors in the near term.

The core sectors may not get impacted as most mid-market investments take a long-term bet on growth potential, the report said. Consequently, private equity deal volumes are expected to pick up in the second half of the year with 2020 expected to be the year of the highest volumes of private equity investments.

The report focuses on the private equity and venture capital industry in India and has been produced in association with the Indian Private Equity and Venture Capital Association, an organisation that works towards promotion of private equity and venture capital firms.

Also read: A $3.3 Billion Manager Sees Hung Parliament Hurting India Share Rally

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