PE investments in India up 74%; highest in 6 years

Private equity firms invested $2.12 billion on 76 deals in India during the October-December quarter, up 74 per cent year-on-year, says a PwC report.

The investments exceeded the $2 billion mark for the first time in 6 years.

The IT and ITeS sector emerged as the leader in terms of value and volume during the period, said PwC MoneyTree India, a quarterly study, based on data provided by Venture Intelligence.

"The fourth quarter of last year proved to be an exciting quarter for PE investment with total flows exceeding $2 billion, the first time since post Q4 2007," PwC Private Equity leader Sanjeev Krishan said.

Investment value witnessed a surge both in terms of quarter-on-quarter basis and year-on-year basis.

On a quarter-on-quarter basis investments value was up by about 19 per cent, while compared to the same period last year (Q4 2012) there was an increase of 74 per cent in deal value.

"Whilst it is difficult to attribute any one specific reason for this sudden surge in deals, it just proved the point that investors, whilst closely watching the run-up

to the elections, remain cautiously positive about the investment thesis for India," Krishan said.

A sector-wise analysis shows that with 37 deals worth USD 959 million in Q4 2013, the IT and ITeS sector emerged as the leader in terms of value and volume of transactions.

"With the US market showing signs of recovery and with the increased attractiveness in the e-commerce space in India, there were not only an increased number of deals compared to the previous quarter, but also a substantial jump in the value," PwC Technology leader Sandeep Ladda said.

The healthcare and life sciences sector witnessed almost four times increase in deal value, from USD 191 million in the previous quarter (Q3 2013) to $729 million in Q4 2013.

The BFSI sector ranked third in terms of value and volume. The sector witnessed investments worth $88 million from five deals.