Volumes fall, but PE and VC investments hit record high in Jan-Mar: Venture Intelligence report

Private equity and venture capital investments touched a record $10.1 billion across 159 deals in the last quarter of the financial year 2018-19, according to data released by Chennai-based Venture Intelligence, a research firm that tracks transactions, valuations and financials of private companies.

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In comparison, $7.3 billion was invested across 158 deals in the previous quarter, and $8 million across 208 transactions for the same quarter last year. The numbers exclude investments in real estate. As many as 23 investments in the March quarter were upwards of $100 million.

Infrastructure companies (energy, road and telecom) accounted for 48 percent of total investments during the quarter under review, totalling $4.9 billion across 16 deals. In the same quarter a year ago, infrastructure attracted investments of $3.7 billion across 13 deals.

The largest investment during the quarter was the $1.8 billion acquisition of Pipeline Infrastructure India by Canadian asset management firm Brookefield from Reliance Industries. Pipeline Infrastructure India owns a 1,400-km natural gas pipeline running from Kakinada to Baruch.

The BFSI sector closed 20 private equity investment deals worth $2.2 billion during the quarter, making it the second most favoured sector, Venture Intelligence said. Carlyle’s acquisition of 9 percent stake in SBI Life Insurance at $653 million was the top deal in this sector.

IT and ITES companies garnered $1.7 billion across 86 transactions. Top deals in the sector included Softbank’s infusion of $400 million into FirstCry, Fosun Group, Softbank, and Carlyle investing $413 million in Delhivery, and Mirae Asset Management, Alibaba, and CDC Group putting in $150 million in Big Basket, Venture Intelligence reported.

Travel and transport ($883 million), telecom ($715 million), logistics ($594 million), and hotel and resorts ($575 million) attracted investments worth over $500 million during the quarter.

Arun Natarajan, Founder of Venture Intelligence, said,

“While average PE-VC deal sizes are up sharply, the fact that this has been accompanied by a rather steep fall in the number (or volume) of investments indicates selectivity."

The January-March quarter accounted for 94 venture capital deals, compared to 124 deals a year ago. Deal volume fell by 23 percent in the classic private equity segment compared to both Q1 of 2018, as well as the preceding quarter.

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