Private equity, Venture capital investments halve in September; FY22 expected to see record activity: Report

Private equity and venture capital funds investments in September have more than halved to $4.8 billion as compared to $10.9 billion in August, but higher than the $4.3 billion recorded in the year-ago period, a report said on Thursday.

On a quarterly basis, investments in the July-September period surged 3.4 times to $25.3 billion, with a sharp rebound in buyout investments and start-up investments accounting for 39 per cent of investments, the report by consultancy EY and industry lobby IVCA said.

“In our view, we could see 2021 PE/VC investments and exits exceed $70 billion and $50 billion, respectively,” said Vivek Soni, partner at EY.

Meanwhile, rival Grant Thornton Bharat also came up with its deal tracker report, which suggested that there were 597 transactions worth $30 billion in the September 2021 quarter with the initial public offerings (IPOs) driving the number at $5 billion.

“(The year) 2021 has seen greater resilience, digital insurgency and inventions driving the deal activity in the recent months. The year witnessed growth every quarter and we expect the trend to continue for the coming quarters,” its partner Shanthi Vijetha said.

The report by EY and IVCA said pure-play PE and VC investments, which exclude investments in real estate and infrastructure, recorded the highest-ever quarterly value at $23 billion, 2.4 times the $9.7 billion recorded in the year-ago period, and 63 per cent higher than the $14.1 billion recorded in the June 2021 quarter.

PIPE (private investment in public equity) investments recorded $1.3 billion across 23 deals in the reporting quarter as against $1.8 billion across 18 deals in the year-ago period, and $619 million across 18 deals in the June 2021 quarter.

Credit investments recorded $1 billion in the September 2021 quarter, compared with $1.1 billion in the year-ago period and $355 million in the preceding quarter.

The September quarter recorded exits worth $11.3 billion, 15 times the value recorded in the year-ago period and 35 percent lower than the preceding quarter.

PE and VC exits have recorded an all-time high of $33.4 billion within the first nine months of 2021, driven primarily by large strategic exits, it said.

The quarter saw $3.4 billion in fundraises compared with $2.8 million raised in the year-ago period and $1 billion raised in the preceding June 2021 quarter.

(With PTI inputs)

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Published on: Thursday, October 14, 2021, 06:37 PM IST

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