PE investments up 62% to $5.4 billion in Q1

Private equity (PE) entities invested about $5.4 billion (Rs 35,000 crore) in India across 124 deals during the quarter ended June, up by 62 per cent than that in the same quarter of 2016, which saw $3.3 billion across 145 transactions.

However, the figure was nine per cent less than the March quarter’s, which saw a record $5.9 billion across 148 transactions. 

Total investments in the first six months of 2017 was a record $11.34 billion (Rs 73,500 crore), as against the $7.4 billion across 335 deals in the same period last year. The previous record high was $10 billion in the second half of 2007.

These figures include venture capital investments but exclude PE investments in real estate.

The largest investment reported during the June quarter was one of $1.4 billion by SoftBank in One97 Communications, parent company of mobile payments service Paytm. It saw 10 PE investments worth over $100 million, twice that during the same period last year. Canadian pension fund CPPIB and global PE firm Warburg Pincus were active and joined SoftBank in the list of investors committing to invest over $1 billion.

On the back of mega investments in Paytm, Tata Technologies and Aegis BPO, information technology and IT-enabled services companies accounted for 49 per cent of the PE investment value pie in the June quarter, attracting almost $2.6 billion across 68 transactions. Led by the Warburg Pincus investment in ICICI Lombard, companies in the banking, financial services and insurance segment were next, attracting $689 million across 12 PE investments. Followed by logistics companies, which attracted $536 million across four transactions (led by CPPIB’s $500 million investment in Indospace Core).

“The most heartening factor about the record investment figures of 2017 is that it was across a range of sectors,” said Arun Natarajan, chief executive of Venture Intelligence. “While last year’s favourites of financial services and infrastructure sectors continue to attract mega dollars, big-ticket investments in new-age companies like Paytm, along with facilitating healthy exits for early investors, have provided re-assurance that the e-commerce story in India is far from over.”