Private equity, venture capital investments dropped to $3.4 bn in October- QHN

Investments by Private Equity and Venture Capital (PE/VC) funds have declined to USD 3.4 billion for October, a report said on Tuesday.

By value, the bets were 3 per cent lower than USD 3.5 billion in the year-ago period, and 19 per cent lower than USD 4.2 billion in September, the report by industry lobby grouping IVCA and EY, a consultancy, said.

The number of deals or volumes was also lower at 70 transactions in October as against 80 in the year-ago period and 83 in a month earlier, the report said.

“Although the Indian consumption story continues to remain strong, the increase in uncertainty on account of global factors and impending state and central elections in India seem to be slowing down progress in deal pipeline activity,” the consultancy firm’s partner Vivek Soni said.

Stating that he has a “cautiously optimistic” outlook, Soni said PE/VC investments are still lacking momentum, especially in the startup space.

October witnessed nine large deals totalling USD 2.4 billion, a 9 per cent increase from the year-ago period, the report said, adding that Abu Dhabi Investment Authority’s (ADIA’s) USD 598 million bet on Reliance Retail Venture was the largest.

Startup investments came in at USD 1.3 billion in October, more than double that of the year-ago period when the industry was passing through a funding winter.

From a sectoral perspective, retail and consumer products led with USD 623 million of PE/VC investments across five deals, driven by the ADIA bet on Reliance Retail Venture.

Real estate sector was second, attracting USD 601 million across six deals. October recorded 17 exits worth USD 1.3 billion, compared to USD 1.6 billion across 15 deals a year earlier, the report said.

The month witnessed a total fundraise of USD 2.4 billion, compared to USD 2.2 billion in October 2022 and USD 1.1 billion in September 2023, the report added.