Chennai: Private equity/venture capital deals saw a decline of 54 per cent in May, consolidating at $2.8 billion due to fewer large deals, said a report. However, rainmakers are hopeful that formation of a strong government can help the scenario.
There were 82 deals involving PE/VC investments of $2.8 billion in May. Large deals fell too, as only five deals of over $100 million were seen to have taken place during the month, EY India said in it Wednesday report.
Within the $2.8 billion fund inflows, buyouts was the largest category accounting for $1.4 billion.
The dip comes amid data release of sagging GDP growth fuelled largely by a fall in consumption which has been the one of the favourite for investors.
From a sectoral perspective, infrastructure topped the list, witnessing $900 million in investments, largely due to the $500-million deal involving GIC and Essel Infraprojects and also the $400-million GIC/KKR deal with India Grid Trust, it said.
Investments by sovereign wealth funds and pension funds accounted for over 40 per cent of the total deals in the month, it said. There was a sharp fall in exits as well, down 55 per cent in the month at $739 million from the year-ago period.
EY partner Vivek Soni, however, exuded confidence in deal making picking up in the coming months on the back of the “decisive electoral mandate” and a “strong deal pipeline”.