Investments by PE, VC funds more than halve to USD 1.9 billion in August: EY

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September 10, 2020 8:07 PM

Investments stood at USD 4.3 billion in August last year and USD 4.1 billion in July this year on the back of deals struck by the Mukesh Ambani-led Jio Platforms, data collated by EY said.

A bulk of the investments in August were ‘private investment in public equity’ space at USD 826 million, while there was a decline in all other deal types, the consultancy said.

Investments by venture capital (VC) and private equity (PE) funds more than halved to USD 1.9 billion (about Rs 13,950 crore) in August as there were no large deals, consultancy firm EY said on Thursday. Investments stood at USD 4.3 billion in August last year and USD 4.1 billion in July this year on the back of deals struck by the Mukesh Ambani-led Jio Platforms, data collated by EY said.

“Although PE/VC investments of USD 1.9 billion in August 2020 are over 50 per cent lower than that in August 2019 as well as July 2020, it has been better than the sub-USD 1 billion monthly run rate seen in the initial months of the pandemic,” EY Partner Vivek Soni said. He said there is a “perceptible improvement” in investor confidence as the Indian as well as global markets begin to open up. The USD 1.9 billion was invested across 75 deals.

The financial services sector reclaimed its top position for PE/VC investments after a gap of three months, with investments worth USD 1.1 billion in August, while the education space is also receiving considerable attention with USD 1.1 billion invested this year, he said.

Exit activity continued to be subdued with only USD 67 million worth of transactions, primarily coming from open market activity, EY said, adding that buoyant equity markets with many PE-backed IPOs lined up for listing may reverse the trend.

A bulk of the investments in August were ‘private investment in public equity’ space at USD 826 million, while there was a decline in all other deal types, the consultancy said. Going by deal value, there were six deals of over USD 100 million as compared to 15 in the bracket in August last year and 10 in July, it said. The total fund raising by India-focused PE and VC firms stood at USD 480 million in August, which is a 58 per cent decline from USD 1 billion raised in August 2019.

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