Grant Thornton: PE funding up 48% to $1.22 billion in July

There were 59 PE transactions worth $1.22 billion in July this year, says report

Private equity (PE) investments in India jumped 48 per cent in value terms to $1.22 billion in July over the same month last year, mainly driven by big-ticket transactions, says a report.

According to Grant Thornton India, there were 59 PE transactions worth $1.22 billion in July this year, while in the corresponding month last year there were 88 such deals worth $826 million.

In July, PE investment values witnessed a strong increase on account of five big-ticket investments, valued at over $100 million each — together accounting for over 67 per cent of the total PE investment values — as compared to only one such deal in May 2016.

The January-July period saw 472 PE deals worth $8.81 billion, registering a 30 per cent rise over the comparable period last year.

"July witnessed around 60 transactions valued at $1.2 billion, which was almost 50 per cent more in value than the same month last year. The sector focus this month for PE seems to be the BFSI (banking, financial services and insurance) sector, with manufacturing and pharma rallying closely behind," Grant Thornton India LLP partner Prashant Mehra said.

The month of July was dominated by investments in start-ups, which accounted for 49 per cent of total investment volumes. On the other hand, banking sector dominated the PE investment values, accounting for 46 per cent of investment values, followed by pharma.

"The sector flavour for this year has been around the core sectors and we will perhaps continue to see this trend as positive macro-economic factors boost these sectors the most. Also, from an exit through IPO (initial public offering) perspective, the probability for success is more in core sectors than others," Mehra said.

Going ahead, the PE deals outlook looks bullish.

"The remaining five months of 2017 will continue to see reasonable growth in PE, but the key growth will perhaps be from PE deals which are looked as an alternate means of financing Domestic M&A," Mehra said.