PE investments witness 36 pc rise in Jan, volume declines: Report

PE investments in India witnessed a 36 per cent growth to USD 1,325 million despite fall in volume on account of increased follow-on investments last month as compared to a year ago, following large-ticket transactions, according to a report.

Private equity (PE) funding stood at USD 1,325 million in January 2019, up from USD 976 million in the corresponding month last year, showing a growth of 36 per cent, said the Grant Thornton's monthly PE Dealtracker for January 2019 report.

"This also resulted in increased average deal size up from USD 10 million in January 2018 to USD 12 million in January 2019. PE deal activity in January 2019 recorded four deals estimated and valued over USD 100 million each capturing 58 per cent of the total PE deal values compared to only one such investment in January 2018," it said.

On the volume front, PE deals stood at 57 in January 2019 against 84 in the year-ago month, a fall of 32 per cent, report said.

"The growth in the value of PE/VC investments (36 per cent) in January 2019 as compared to January 2018 is primarily because of number of large-ticket investments, which also reflected in the average ticket size trend, which increased from USD 11.62 million in January 2018 to USD 23 million in January 2019.

"An increase in large-ticket investments also reflects the rise in confidence of the investors and strengthening the role of PE/VC fraternity as growth capital providers," said Pankaj Chopda, director, Grant Thornton India LLP.

As compared to December 2018, PE deal value in January 2019 fell 39 per cent primarily on account of Swiggy's USD 1 billion funding. Excluding this deal, the investment value remained on par with the level of investment value recorded in December 2018.

The report further said January was dominated by investments in start-ups, which contributed to more than half of the total investment volume valuing at USD 158 million.

The Financial technology segment got significant attention from investors with seven deals followed by travel and logistics space together capturing 47 per cent of the volume within the start-up sector.

Banking, information technology and e-commerce sectors remained impressive, garnering big-ticket investments valued over USD 100 million.