The first six months of 2009 see 96 private equity deals worth $1.92 billion.
Propelled by recovery in stock markets, private equity (PE) investments in the country hit $1.03 billion in the June quarter, a 17 per cent sequential increase.
PE firms invested this amount in 54 deals. The previous quarter had seen 42 deals worth $883.97 million, according to data compiled by SMC Capitals.
“With stock markets recovering, PE investors have regained confidence in Indian firms and have started putting in money,” said Jagannadham Thunuguntla, equity head, SMC Capitals.
However, on a year-on-year basis, the number of PE deals has nearly halved in volume terms and declined 69 per cent in value terms. The June quarter of 2008 saw 84 PE deals worth $3.30 billion.
The latest numbers take total investments in the first six months of 2009 to over $1.92 billion (in 96 deals) as against the $7.95 billion invested (in 202 deals) during the corresponding period last year, according to the study.
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“Although the pace has increased, PE funds are yet to gain the momentum of last year, when the stock market was on a high growth path,” said Thunuguntla. “Going ahead, PE investments are going to increase in India as valuations are now cheaper,” he said.
According to a report by research firm Venture Intelligence, the single-largest investment in Q2 was IDFC PE and Oman Investment Fund’s Rs 600 crore commitment to QuippoTelecom. This was followed by Norwest Venture Fund’s acquisition of 2.1 per cent stake in the National Stock Exchange for Rs 250 crore. In the June quarter, the IT &ITeS sector registered 12 deals worth $67 million, followed by healthcare and life sciences (six deals worth $129 million) and BFSI (six deals worth $116 million).
“While IT & ITES continued to attract the most number of PE deals, investments in the industry declined in both value and volume terms for the fourth straight quarter,” said Venture Intelligence CEO Arun Natarajan.
Some major PE investments during the second quarter of 2009 were Axious Investments’ $40 million (about Rs 200 crore) commitment to Quippo Telecom, followed by Pangea Capital's acquisition of stake in infrastructure firm Cobol Technologies for $30 million (about Rs 150 crore).
Other investments during the quarter included Rs 183 crore investment commitment by Standard Chartered Private Equity in Mahindra & Mahindra Financial Services and IDFC PE’s $45.30 million (about Rs 222 crore) invsestment in GMR Energy (Orissa Power Project SPV).