August reports highest PE and VC exits so far in 2022: IVCA-EY report | The Financial Express

August reports highest PE and VC exits so far in 2022: IVCA-EY report

The strong exit performance in August 2022 was on account of a few large open market exits, which included KKR selling its 28% stake in Max Health for $1.2 billion and Blackstone selling its 14% stake in Sona BLW for $509 million.

August reports highest PE and VC exits so far in 2022: IVCA-EY report
PE/VC investments in August 2022 were the lowest in the past 19 months, 80% lower than the value recorded in August 2021. (Representational image)

Exits in the private equity and venture capital (PE and VC) space stood at a record $3.1 billion, across 25 deals, in August 2022, the highest value in 2022, helped largely by large open market exits, IVCA-EY’s monthly PE/VC roundup report showed.

The strong exit performance in August 2022 was on account of a few large open market exits, which included KKR selling its 28% stake in Max Health for $1.2 billion and Blackstone selling its 14% stake in Sona BLW for $509 million. Secondary and strategic exits too saw some marquee deals being executed, recording $584 million and $687 million in aggregate value, respectively. That was a significant improvement from the previous month, which recorded exits only worth $322 million across nine deals. It was, however, significantly lower when compared with August 2021, which recorded exits worth $7.4 billion across 42 deals.

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The funding activity last month, however remained muted. At $2.2 billion, PE/VC investments in August 2022 were the lowest in the past 19 months, 80% lower than the value recorded in August 2021, which saw $11.2 billion worth of investments. Even month on month, the funding activity was 46% lower than investments in July’s $4.1 billion.

Despite the decline in funding activity, the healthcare sector, infrastructure space and the financial services category were the top three picks. “PE/VC exits had a strong showing in August 2022, recording its best performance this year,” Vivek Soni, partner and national leader, private equity services, EY India noted. “Most sectors recorded a sharp decline in PE/VC investments in August 2022. The healthcare sector, however, bucked the trend to record a year-on-year increase of 485%. The healthcare sector in India has grown in favour among PE/VC funds in recent years, receiving almost $9.5 billion in investments since 2017. The exit performance too has been good in this sector, with exits worth almost $5.3 billion in the same period,” he added.

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The Indian healthcare sector is growing rapidly at a compound annual growth rate (CAGR) of around 22% since 2016 due to increasing coverage, breadth of services, expenditure by public and private players, and the growing demand for good quality healthcare. At the current rate, it is expected to reach $372 billion in 2022. India, being a highly under-penetrated market, provides ample growth opportunities for companies and investors alike, the report highlighted.

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