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Private Equity investment down for 3rd consecutive quarter

Private Equity investment in India continued to see year-on-year decline for the third consecutive quarter, as they fell nearly 50% to $1.89 billion in the quarter ended March 2012.

However, the number was higher than the $1.47 billion recorded in the December quarter.

“There were six reported PE investments worth over $100 million during the first quarter, compared to 9 such transactions in the same period last year,” Venture Intelligence, a firm tracking deal activity in India, said. The number of deals worth $200 million (Rs 1,000 crore) or more fell to zero in the quarter from 5 in the same quarter of 2011.

The number of deals too fell from about 107 to 90 this year.

The Healthcare & Life Sciences industry attracted $581 million (31% of the value pie) across 14 investments during the period. It was followed by IT & ITES (BPO) companies with $308 million across 35 reported investments and BFSI (finance) firms with $280 million across 11 investments.

Last year, Venture Intelligence had conducted a survey in which PE investors highlighted healthcare as the most attractive sector for investments in 2012.

The firm pointed out that the trend of the larger PE firms buying out the stakes of earlier PE/VC investors in Indian companies gathered momentum during the latest quarter. Examples during the quarter included the GIC-Vasan deal, which saw a part exit for Sequoia Capital India, and the $104 million investment by General Atlantic in Fourcee Infrastructure, a complete exit for Mayfield.

Real Estate oriented Private Equity firms made 12 investments amounting to US$477 million in 10 deals, the firm added.

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