PEs preferring China, India for investments in 2010

Private equity funds are looking at emerging markets as their investment destination in 2010, and India has emerged as the second most preferred country after China for investment, says a survey.

According to a survey by global PE research firm Preqin, the Asian countries are receiving considerable investor interest, with 45 per cent of respondents saying that this region is attractive at present.

Supported by strong fundraising targeted at the country for the past couple of years, China was voted as an area of interest by just over half of respondents, followed by India for which 41 per cent voted in favour, Preqin said.

"Emerging markets are, at present, attracting a significant degree of attention from investors, with two- thirds of respondents to our survey either currently having exposure to these markets or intending to invest there in the future.

58 per cent told us they invest in emerging markets and an additional 9 per cent will consider," it said.

"The proportion of investors that are actively seeking to invest in the asset class is gradually increasing, and it is notable that half of investors have set aside more capital for new private equity investments in 2010 than they did in 2009," Preqin Manager, Investor Data, Helen Kenyon said.

Although a growing number of PE investors are all set to return to the market in 2010, but challenges and risks of investments remain high during the period.