Share in total up 2.5x in 4 yrs

It has been the coming of age for domestic private equity (PE) funds. Not only has their share of total funds invested in the country gone up by 2.5 times in the last four years, but their latest fundraise is also far more than what they did earlier.

The share of domestic PE funds has gone up from a mere 4 per cent of the total (among domestic, global and government-backed PES) $19 billion invested in 2019. It went up to 10 per cent in 2023 of the total $16 billion overall PE investment in the country, according to India Private Equity Report 2024 released by Bain and Company in collaboration with IVCA.

During the same period, PE funding by global investors has fallen from 58 per cent to 50 per cent. However, the governmentlinked investors share went up from 38 per cent to 39 per cent during the same period.

Even average deal sizes of key domestic PE players like Kedara and Cryscapital doubled to $100 million in 2023 from $50 million in 2019.

There was an increased focus on buyouts with funds doing more deals — from 33 in FY20 to 41 in FY24.

All that has been possible as leading domestic funds — Cryscapital, Kedara and Multiples — announced fundraises of $5 billion in 2023. They are aiming at a record fundraise with 20-50 per cent higher target size than their previous raises.

Chryscapital, for instance, in 2023 raised between $1.6 billion and $1.9 billion, which is far more than its previous high of $1.4 billion in 2022.

Similarly, Kedara Capital in 2021 had raised its largest amount of $1.1 billion. In April last year, it finally closed a deal to raise $1.7 billion.

Following the same route, Renuka Ramnath-founded Multiples announced the raise of a $1-billion fund in 2023, which closed its first round of $640 million in May 2023. Earlier, the highest fundraise was $700 million in 2021.

But that does not mean that leading global funds are quiet — they are also increasing allocation of India in their Asia-pacific funds.

For instance, India’s share within the Asia-pacific deal activity has increased from 15 per cent in 2018 to 20 per cent in 2023. Carlyle, for instance, announced in 2023 that 3035 per cent of its Asia-pacific funds will be allocated to India, making it its largest market in Asia.

Singapore-based Temasek has announced investments worth $9-10 billion in India over three years. Advent will invest between $5 and $10 billion in the next five years and Bain Capital $7 billion in the next three-five years, among others.