Market Trends of India Private Equity Industry
This section covers the major market trends shaping the India Private Equity Market according to our research experts:
Increase in the Value of Private Equity Deals, Y-O-Y
In 2018, the Indian private equity market witnessed about 793 deals, which were valued at USD 26 billion. This investment value was the second highest in the last decade. Moreover, private equity funds are focusing on prioritizing deal quality over quantity, with the top 15 deals comprising about 40% of the total deal value and numerous deals were worth more than USD 50 million. The market remained strong, indicating investor confidence in the Indian market. In 2018, nearly half of the exit value resulted from the sale of Flipkart to Walmart, which was worth USD 16 billion. However, even after excluding that, 2018 was one of the best years for exits in the past decade. In the Asia-Pacific region, diversified fundraising had slowed down, as a result of the Chinese government's decision to tighten rules on private equity investment. However, India-focused dry powder remained healthy at USD 11.1 billion.
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Private Equity Investment in the Indian Commercial Real Estate is an Uptrend
Several private equity players, such as Xander, Blackstone, and Brookfield, are primarily focusing on the Indian real estate industry, especially the commercial segment, with several transactions recorded in the country in 2018. The business and companies, both, multinational and domestic, witnessed expansion. There have been several developments in the Indian market, such provision of the infrastructure status to the logistics sector, allowance of 100% FDI in the e-commerce market, and comprehensive tax reforms, like the Goods and Services Tax (GST). Such developments boosted the prospects of investment in the Indian commercial real estate market. Private equity investors were focusing on investing in commercial, affordable housing, logistics, and warehousing, due to steady rentals and rental yield. Furthermore, increase in the number of buyouts was the primarily that aided the investments in the private equity market.
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