Value of PE/VC investments India 2015-2019
The Indian private equity and venture capital sector recorded an all-time high in 2019, reaching 48 billion U.S. dollars from around 1,037 deals. In the last three years, the country has been outperforming in this sector, and the investment deal volume had increased by almost 28 percent in 2019 compared to 2018.
Infrastructure sector pegs a win
The surge in investment activity was led by some big-ticket deals in the infrastructure sector. With 40 per cent of the investments, this sector attracted a little over 14 billion U.S. dollars, compared to just around five billion dollars in the preceding year. This spurt in investments in the previously neglected infrastructure sector was largely driven by the Indian government’s initiative of introducing new structures like InvITS trusts. The primary objective of these infrastructure investment trusts is to encourage more individuals to invest in the sector. Essentially, they are investment instruments similar to mutual funds, and are regulated by the Securities and Exchange Board of India. This has attracted a new class of investors through tax-efficient operational risks, thereby boosting the sector’s interest in the market.
Affordable housing wins highest funds
The largest fund-raise in 2019 was the government-sponsored Special Window for Affordable and Mid-Income Housing (SWAMIH) fund that raised over 1.4 million U.S dollars. This deal has been viewed as pivotal in providing last-mile funding to real-estate developers to complete stalled housing projects across the country. The government expects to relieve as many as 250 thousand housing units through this fund while creating a new alternative investment opportunity for investors.
Infrastructure sector pegs a win
The surge in investment activity was led by some big-ticket deals in the infrastructure sector. With 40 per cent of the investments, this sector attracted a little over 14 billion U.S. dollars, compared to just around five billion dollars in the preceding year. This spurt in investments in the previously neglected infrastructure sector was largely driven by the Indian government’s initiative of introducing new structures like InvITS trusts. The primary objective of these infrastructure investment trusts is to encourage more individuals to invest in the sector. Essentially, they are investment instruments similar to mutual funds, and are regulated by the Securities and Exchange Board of India. This has attracted a new class of investors through tax-efficient operational risks, thereby boosting the sector’s interest in the market.
Affordable housing wins highest funds
The largest fund-raise in 2019 was the government-sponsored Special Window for Affordable and Mid-Income Housing (SWAMIH) fund that raised over 1.4 million U.S dollars. This deal has been viewed as pivotal in providing last-mile funding to real-estate developers to complete stalled housing projects across the country. The government expects to relieve as many as 250 thousand housing units through this fund while creating a new alternative investment opportunity for investors.
