How Did India's PE-VC Market Grow by 9% to $43 Billion in 2024?
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Synopsis
India's PE-VC market saw a remarkable recovery in 2024, achieving a growth of 9% to reach $43 billion. This resurgence was driven primarily by traditional sectors, showcasing a renewed investor confidence in the country’s economic stability. Discover how these trends are shaping the investment landscape.
Key Takeaways
- India's PE-VC investments grew by 9% in 2024.
- Total market value reached $43 billion.
- Approximately 1,600 deals were recorded.
- Real estate and infrastructure led investment sectors.
- Buyout deals increased in significance, now comprising 51% of total deal values.
New Delhi, May 7 (NationPress) The private equity and venture capital (PE-VC) investment landscape in India witnessed a significant rebound in 2024, growing by nearly 9 percent to hit $43 billion across approximately 1,600 deals. Traditional sectors played a crucial role in this market growth, as per a report released on Wednesday.
This recovery has solidified India's standing as the second-largest PE-VC hub in the Asia-Pacific region, accounting for around 20 percent of total investments, which reflects an increase in investor confidence tied to the country's macroeconomic stability, according to the report from Bain & Company.
While the overall growth can be attributed mainly to venture capital (VC) and growth investments, private equity (PE) investments remained stable at $29 billion. Funds faced challenges due to high valuations in a thriving public market, complicating deal closures.
“A notable shift towards buyout deals is emerging, with their share of overall PE deal values increasing to 51 percent in 2024 from 37 percent in 2022. This indicates a strategic focus on acquiring control of high-quality assets across various sectors, supported by record dry powder. This suggests that buyouts may continue to play a pivotal role in PE activity as funds look for scalable value creation opportunities,” stated Prabhav Kashyap, Partner at Bain and Company.
Key sectors such as real estate, infrastructure, and select traditional industries like IT/ITeS and financial services drove funding, while other traditional sectors like energy and manufacturing saw a decline after experiencing two years of growth. The year was subdued for deal closures due to high valuations and increased competition.
Real estate and infrastructure led the way, comprising 16 percent of total PE-VC investments, with a remarkable 70 percent surge in deal value compared to the previous year. Financial services also experienced robust growth of about 25 percent, particularly in non-banking financial companies (NBFCs) focused on affordable housing finance, with 14 deals including seven transactions of $100 million in 2024.
2024 was also a pivotal year for exits, as India's exit values surpassed all other Asia-Pacific markets, reaching an impressive $33 billion with a year-over-year growth of 16 percent. This surge reflects a trend of investors increasingly leveraging buoyant public markets to exit matured positions, as highlighted in the report.
Point of View
It is crucial to recognize the resilience shown by India's PE-VC market in 2024. The growth in investments amidst global economic fluctuations not only reflects the strength of traditional sectors but also highlights the confidence investors have in India's macroeconomic stability. This trend is a positive signal for the future of our economy, emphasizing the importance of continued support for growth in these sectors.
NationPress
21/05/2025
Frequently Asked Questions
What is the current status of India's PE-VC market?
India's PE-VC market experienced a recovery in 2024, growing by 9% to reach $43 billion across approximately 1,600 deals.
Which sectors are driving the growth of the PE-VC market?
Traditional sectors such as real estate, infrastructure, IT/ITeS, and financial services are significantly contributing to the growth of the PE-VC market.
What challenges are faced by private equity investments?
Private equity investments are facing challenges due to high valuations in buoyant public markets, making deal closures more difficult.
How has the trend of buyout deals changed?
The share of buyout deals in overall PE deal values rose to 51% in 2024, indicating a strategic shift towards acquiring control of high-quality assets.
What was the value of exits in India's PE-VC market in 2024?
In 2024, exit values in India's PE-VC market reached $33 billion, surpassing all other Asia-Pacific markets, reflecting a 16% year-over-year growth.
