Last updated: January 10, 2023, 5:30 PM IST
In the December quarter, PE investment totaled USD 3.61 billion, down 8.1 percent sequentially from USD 3.93 billion and was down 67.2 percent year-over-year when it was USD 11.06 billion , the report said. (Representative image)
Internet-specific computer software and transportation attracted the bulk of the funding, accounting for 66 percent of the total for the year at $8.58 billion.
Private equity investment in domestic companies fell sharply 42 percent year-over-year to $23.3 billion in 2022, the lowest level since 2019, when it was $15.8 billion, according to an industry report.
The numbers reflect the overall funding winter that the startup space in particular and total foreign investment in general has experienced since the war in Ukraine began last February.
Private equity investment inflows into the country fell a sharp 42 percent in 2022 from last year to $23.3 billion – the lowest annual inflow since 2019 when it was a low $15.8 billion, but still relatively high compared to historical levels, said Elaine Tan, a senior analyst at Refinitiv, the LSEG industry that provides data and insights into the financial markets.
The report did not mention how many deals were closed in the year.
In the December quarter, PE investment totaled USD 3.61 billion, down 8.1 percent sequentially from USD 3.93 billion and was down 67.2 percent year-over-year when it was USD 11.06 billion , the report said.
The total number of deals in Q4 fell 24.8 percent to 333 from 443 in Q3 and 19 percent from Q4 of 2021 when the number of transactions was 411, the report said. Tan attributed the sharp drop to ongoing geopolitical tensions, rising interest rates and recession fears in Western economies, which made global investors cautious about investing.
Internet-specific computer software and transportation attracted the bulk of the funding, accounting for 66 percent of the total for the year at $8.58 billion.
In the internet-specific sector, fund inflows are down 57.4 percent, while the number of deals fell from 556 in 2021 to 528 in 2022.
Computer software companies saw financing decrease by 46.4 percent, financial services (-34.6 percent), as well as medical and health services saw the same decrease by 26.4 percent from 2021 levels.
However, industries focusing on transportation saw inflows nearly double with a 93 percent increase, communications increased 225.6 percent, and agri/forestry/fisheries increased 215.8 percent in terms of fund inflows.
Tan expects this trend to continue as investors move away from China due to heightened uncertainty, and India and Southeast Asia could benefit from this shift.
Of the total, domestic PE funds raised USD 13.7 billion in 2022, an increase of 163.2 percent from 2021 when it was only USD 5.21 billion. This increases the significant capital waiting to be deployed as India-based PE fundraising activity has totaled $32 billion – from 2019 to 2022.
The deal street was led by Think & Learn and VerSe Innovation, each receiving $800 million from PEs in the year, followed by Bharti Airtel and Bundl Technologies, receiving $700 million each, Tata Motors Electric Mobility ($494.7 million) , Reliance Retail (USD 343.5 million), NTEX Transportation Services (USD 330 million), Delhivery (USD 304 million), and Busybees Logistics Solutions and Renkube each received USD 300 million.
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(This story has not been edited by News18 staff and was published from a syndicated news agency feed)
