Chennai: Due to market volatility, Private Equity (PE) investments have fallen down to $14.6 billion from the previous year’s $15.6 billion, a report has stated.
According to Grant Thornton’s latest PE Dealtracker report, the decline in the first nine months, January-September, of 2018 is a result of macroeconomic concerns, market volatility and valuations of companies.
Besides these factors, private equity investors are also turning cautious due to falling prices of rupee against the US dollar and touching its all-time low amid an investors exodus from the emerging markets, it stated.
During the January-September period, a total of 621 PE deals worth $14.60 billion were reported as compared with $15.60 billion in the same period last year.
On the other side, the July-September quarter saw a total of 217 PE deals worth $5.2 billion, an increase of 41 per cent in terms of the number of deals, despite a drop in value by 28 per cent, compared with the same period last year, the report said.
Telecom, e-commerce, manufacturing, energy, agriculture banking and IT sectors led the deal activity, capturing 85 per cent of the total deal value. Startups had a share of 46 per cent of the total investment volumes. Financial technology also attracted significant attention from investors with 20 deals, followed by retail and health tech segments.
“The environment for private equity market has been sluggish due to concerns like the economy, market volatility and valuations, among other things,” said partner, Grant Thornton India LLP, Prashant Mehra.
Some of the other top deals during the third quarter include ADIA and TPG Capital’s investment in UPL Corp, KKR’s investment in REEL, Udaan’s series C funding for $225 million, the report said, adding that Curefit raising $120 million marks the biggest ever fund raise by an Indian healthcare startup.
In September quarter of last year, the private equity and venture capital (PE/VC) investments in Indian startup ecosystem reached $8.7 billion. In total, Indian startups witnessed a total of nine $200-million-plus deals in the July-September 2017 quarter, with SoftBank’s $2.5 billion investment in Indian e-commerce giant Flipkart being the largest PE investment ever recorded in the Indian subcontinent.