PE deals see $4.3-billion push in April-June quarter: PwC

Says the second quarter of this year also witnessed PE exits worth $3.5 billion

Private equity investments stood at USD 4.3 billion in the April-June quarter and the deal momentum is likely to continue in the remaining second half of this year as well, according to PwC.

The leading consultancy firm said, besides, significant investments, the second quarter of this year also witnessed PE exits worth USD 3.5 billion.

"A quick run-down of the transactions for the quarter would indicate that with the exception of e-commerce investments, a very large proportion of PE investments are secondary transactions, i.e. A PE fund facilitating exit of an existing investor," PwC Partner and Leader Private Equity Sanjeev Krishan said.

However, this cannot undermine the focus that PE funds have on fresh investments, PwC said.

"A number of PE funds believe they are under-invested in India, and are anticipating atleast a sequential six-seven year growth window in India, which should normally be a good time-frame to exit the investment too," Krishan said.

According to the report, the resilience in the stock markets is giving promoters the confidence in IPOs, and some of these would provide exit to PE investors.

"We have already seen a large number of exits through sales in the stock market and this is expected to continue as well," the report added.

Sector-wise, technology sector contributed over USD 1.7 billion in investments. E-commerce and E-services continued to contribute the most significant component of technology PE investments and this is unlikely to change in the near future.

Technology sector deals was mainly aided by USD 440 million buyout of CMS Info systems by Barings Asia.

Pharmaceuticals and Healthcare was the second highest contributor with Temasek investing USD 293 million investment in Sun Pharma among other deals in this space.

Financial Services and Manufacturing sectors were amongst the top four sectors, respectively owed to Apax Partners' investment of USD 383 million in Shriram City Union Finance and a USD 315 million buyout of Crompton Greaves by Temasek and Advent together.

Energy found a place in the top five as well with deals worth USD 369 million, PwC said.