Private equity and venture capital investments in the first half of 2022 increased by 28 percent to USD 34.1 billion year-on-year, due to large growth and startup investments, as per an IVCA and EY report.
Amidst the funding winter, the Indian startup ecosystem received PE\VC investments worth USD 34.1 billion across 714 deals, including 92 large deals worth USD 23.7 billion in the first half of this year.
The largest deals in 1H22 saw Bodhi Tree acquire a 40 percent stake in Viacom18 for USD 1.8 billion followed by CPPIB, Sofina, Sumeru Ventures and others investing close to USD 805 million in Dailyhunt.
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The sector that received the largest amount of PE/VC investments was fintech at USD 7.3 billion, followed by the e-commerce and technology sectors, both of which received around USD 4 billion.
Media and entertainment, logistics and education were some of the new sectors that saw significant PE/VC interest recording a 2-3x increase in investments over 1H2021, the study stated.
“While startup investments continued to lead after recording a 53 percent YoY increase in 1H2022, they have declined by a third compared to the second half of last year when startup deals were at an all-time high. Buyouts have been the lowest since the first half of 2020, which was impacted by COVID, recording USD 4.3 billion across 25 deals, a 46 percent decline YoY and 70 percent decline sequentially,” said Vivek Soni, Partner and National Leader, Private Equity Services, EY India.
“PE/VC exits too were lower by more than 55 percent both sequentially and on a y-o-y basis in the absence of large strategic and secondary deals,” Soni added.
On a YoY basis, exits recorded a 57 percent decline in terms of value in 1H22 (USD 9.6 billion) compared to 1H21 (USD 22.3 billion) and a 54 percent decline compared to 2H21 (USD 21 billion). The decline was on account of smaller deal sizes, the report showed.
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