• PE exits in Q1 of CY 17 (Jan - March) totaled at 2.59 billion USD, is the best ever first quarter for exit in India
• The IT & ITeS sector witnessed the highest investment activity (3.3 billion USD invested), followed by Telecom and the Banking, Financial services & Insurance (BFSI) sector
Mumbai, June 1, 2017: Q1 of CY 17 saw a new high for PE investments in India over the last decade. The quarter recorded total investments worth around 6.8 billion USD in 130 deals. This is second only to the approximately 6.9 billion USD attracted in Q3 ’15. The average deal size for Q1 ’17 was around 52.3 million USD.
These findings are part of the PwC MoneyTree™ India report, a quarterly study of private equity investment activity based on data provided by Venture Intelligence.
As per the report, the PE appetite continued to be strong with late-stage investments accounting for almost 44% of the investment value this quarter. Early-stage investments declined by around 30% in terms of value as compared to the previous quarter, while the value of PIPE (private investment in public equity) deals increased almost threefold over the last quarter of 2016 to around 1.6 billion USD.
Regionally, National Capital Region (NCR) raced ahead of Mumbai with total investments worth around 2.4 billion USD. With a staggering 790% increase in PE investment value, Bengaluru climbed to the second position, pushing Mumbai down to the third spot.
Sanjeev Krishan, leader, Private Equity, PwC India said, “With valuations at an all-time high, deal activity in the coming quarters is likely to continue at a watchful pace, with investors looking for quality deals. The government continues to improve economic resilience with the dismantling of the Foreign Investment Promotion Board (FIPB) and the introduction of the Goods and Services Tax (GST), which should drive investor confidence and positivity going forward."
Sandeep Ladda, leader - Technology, PwC India said, “Investments in new technologies such as IoT, AI, automation, smart mobility, P2P payments and remote monitoring are growing, thus paving the way for their entry into the mainstream digital economy. Indian IT companies were also seen to boost their automation credentials following a rise in customer demands for lower prices. This could soon lead to a natural change in hiring patterns, with unconventional roles likely to be more attractive for high-margin digital jobs. Also, the government’s big push to the digital economy with a host of measures like, Digi Gaon and Aaadhar Pay, has been well received."
Private equity exits
From an exit standpoint, this quarter recorded the second highest activity in the last decade, with around 3.2 billion USD across 53 exits, a 72% increase in value over the previous quarter and a 37% increase in value over the same period last year. Secondary sales accounted for around 41% of the exit value in this quarter, indicating a probable increase in secondary opportunities ahead.
IT & ITeS was the top sector in terms of PE exits in this quarter, with a total of nine exits worth around 1.1 billion USD. BFSI and Healthcare & Life sciences followed, with exits worth around 683 million USD in 11 deals and 497 million USD in 10 deals, respectively. The Manufacturing sector witnessed a decline (83%) in exit value this quarter.
Gaining a slight edge over public market sales, secondary sales emerged as the most preferred exit route, with a total value of around 1.3 billion USD in eight deals. In all, 28 exits worth around 1.3 billion USD followed the public market sale route in Q1 ’17.
Note to editors
Information included in this release or related venture capital investment data should be cited in the following way: "PwC's MoneyTree™ India Report with data provided by Venture Intelligence." After the first reference, subsequent references may refer to PwC's MoneyTree India Report. Charts and tables displaying the data are sourced to "PricewaterhouseCoopers India Pvt. Ltd/Venture Intelligence data." After the first reference, subsequent references may refer to PwC MoneyTree India Report. For access to the report, please visit https://www.pwc.in/publications/moneytree.html
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