PE/VC investments drop 75% in October over last year: IVCA-EY report

Private equity and venture capital (PE/VC) investments for October 2022 dropped 75 per cent compared to the same period last year, with total investments of $3.3 billion across 75 deals, including six large deals worth $2.2 billion, according to the IVCA-EY monthly PE/VC round-up.

According to Vivek Soni, partner and national leader, private equity services, EY, after being on a declining trend for the past five months, PE/VC investments have recorded a 60 per cent sequential uptick this month.

“The Indian economy continues to outperform relative to other emerging markets and while there may be short-term volatility, the PE/VC community continues to be sanguine about India’s long-term growth prospects,” he said.

Inflation woes, recession fears, the rising cost of capital, and elevated levels of uncertainty driven by geopolitical tensions have weighed down the PE/VC activity in 2022, globally as well as locally. “In India, the investment momentum, both in terms of size and number of deals, has slowed down considerably,” Soni added.

2022 has, so far, been the best year for credit investments, recording $3.5 billion in investments. Credit investments in 2022 to date are 5 per cent more than the previous high recorded in 2019. Four sectors — financial services, real estate, infrastructure and e-commerce — have accounted for almost 80 per cent of all credit investments between 2017 and 2022 (January-October).