Investments in private equity (PE) fell 30.7% quarter over quarter (TQ) to $8.03 billion in the March quarter of calendar year 2022 (T1CY22), versus $11.59 billion in Q4CY21, according to Refinitiv. However, they were up 88.6% year-over-year from $4.2 billion in Q1CY21.
The total number of transactions also fell to 387 in Q1CY21 from 410 in the previous quarter. However, on an annual basis, the total number of transactions increased by 35% compared to 286 views in Q1CY21.
Among sectors, Internet-specific software and software attracted the most investment in Q1CY22, with a total investment of $3.5 billion, compared to $1.5 billion in Q1CY21. Sectors such as financial services ($205.8 million), medical/healthcare ($42.3 million) and biotechnology ($6 million) saw declines in the first quarter compared to the last quarter. ‘last year.
The top deals in the quarter were led by the $800 million investment in Bjyu’s, followed by a $700 million investment in Swiggy. The $494.72 million investment in Tata Motors Electric Mobility, $300 million funding raised by NTex Transportation Services (ElasticRun) and $300 million raised by Xpressbees were in the list of top five deals during of the quarter.
Funds located in India saw their amount raised 3.6 times quarter-on-quarter to $4.45 billion in Q1CY22. However, the number of companies in which the investments were invested fell by 60.6% to 28.
“Momentum was driven by several important factors, including a historically low interest rate environment, digital acceleration and transformation, and the increasing depth of the start-up ecosystem. Substantial capital is also waiting to be deployed, as India-based private equity funds have raised $4.4 billion so far this year, more than double the amount raised in the first quarter of last year. , bringing fundraising activity to over $21 billion in 2019 Q1. of this year,” said Elaine Tan, senior analyst at Refinitiv.
A boom in the IPO market in 2021 has also supported the private equity industry.
“Last year, the buoyant secondary market and record primary listings in India boosted confidence in the IPO markets, providing a conducive environment for companies to go public and providing a positive element for start-ups. and investors to consider IPO as a viable exit strategy,” Tan added.
However, secondary market volatility following the Russian invasion of Ukraine and the US Federal Reserve’s decision to aggressively tighten monetary policy dampened the IPO market.