Private equity firms (PE) have invested $27.7 billion in India so far this year, nearly the same as last year, betting big on the long-term India growth story and signalling a letup in the funding winter.
As many as 342 PE deals were sealed in the country as of Dec. 16, only a slight mark down from 357 in 2023, show data compiled by research firm Venture Intelligence.
Even as the PE deal value and deal volume remained nearly flat and uncertainty prevailed in the global market, “these are the best times to deploy new capital,” Manish Kejriwal, founder & managing partner at Kedaara Capital, had earlier told DealStreetAsia in an interview.
After mass layoffs, faulty accounting practices, inflated valuations, and widening losses in 2023, there was a lot of clarity this year as valuations were cut to more reasonable sizes, separating the good companies with solid unit economics from the bad ones.
“There has been a correction in the market — I would say it was much needed and a very healthy one that has compressed the number of deals,” Sam Subramaniam, President-Private Equity Investments & Group Strategy, Bajaj Finserv had earlier stated. “It only shows the industry is finally on the mend,” he had added.
While healthcare emerged as the most funded sector in the Indian private equity space this year in terms of value, e-commerce, manufacturing, fintech and enterprise software firms also evinced significant PE interest this year.
“M&A, consolidation, aggregation, and platform play are all gaining ground and redefining healthcare investments in India… while hospitals are attracting a lot of PE interest, segments such as transplant, and robotics are also rising to be game changers coupled with healthcare financing,” said Ramesh Kannan, senior partner at Somerset Indus Capital Partners.
In terms of PE deal volume, however, e-commerce surpassed healthcare with 57 transactions, while the number for healthcare deals stood at 50.
Among the top PE deals sealed in the country, infrastructure investment trust ATC India raised a whopping $2.5 billion from Brookfield, while pure-play digital services company Altimetrik amassed $900 million from TPG Capital.
In other big-ticket transactions, Healthium Medtech, a medical devices company focused on products used in surgical, post-surgical and chronic care; quick commerce firm Zepto; and Shriram Housing Finance, an NBFC; among others also raked in big cheques.
Going forward, the requirement for growth capital will go up as India has evolved and is starting to see a better crop of entrepreneurs with more depth in the market.
“The volatility has brought maturity not only in the life of entrepreneurs but also in the life of capital providers, all contributing positively to money coming in,” Deepak Padaki, President, at Catamaran India, had told DealStreetAsia.
