Press Release:
Private Equity - Venture
Capital (PE-VC) firms investments in India fell by 29% in 2022 compared
to the record highs of 2021. PE-VC firms invested $46 Billion (across
1,261 deals) in Indian companies in 2022, compared to $65 Billion
(across 1,362 deals) in the previous year, reports Venture Intelligence, a research service focused on private company financials,
transactions, and their valuations. (Note: These figures include Venture
Capital type investments, but exclude PE investments in Real
Estate).
India minted a total of 21 "Unicorn" companies (VC-funded startups valued at $1 Billion or more) in
2022, 18 of them during the first six months of 2022 and less than half the 44 Unicorns minted in 2021. In fact, the final quarter of 2022 did not see any new unicorns being created. SaaS companies accounted for 29% of all the new unicorns in 2022,
followed by Fintech companies with 19%. Overall, Unicorn Startups in India
attracted $9.8 Billion worth of investments in 2022, down by 61% compared
to the previous year (which saw $25 Billion invested in Unicorn
Startups).
2022 witnessed 111 mega deals ($100 M+ rounds) worth $31 Billion, compared to 152 such investments worth $50.3 Billion in 2021. Qatar Investment
Authority's $1.5 Billion investment in the new media and consumer
technology-focused platform Bodhi Tree (co-created by media veteran Uday
Shankar and James Murdoch's Lupa Systems) was the largest in 2022. This was followed by the $1.1 Billion investment
into publicly listed Yes Bank by global PE investors Carlyle Group and
Advent International.
VC* investments in 2022 - at $24 Billion across 1,130 deals - fell by over
32% compared to 2021 ($35.4 Billion across 1,215 deals). (For the purpose of this analysis, VC is defined as Seed to Series F
investments in companies less than ten years old and late-stage tech
investments). FinTech and E-Commerce sectors attracted more than $5 Billion in VC funding each, while Enterprise Software startups attracted $4.8 Billion.
Sequoia Capital India was the most active VC investor in 2022
with 73 investments (including new and follow on investments), followed by Accel India and Better Capital with 57 investments each. Tiger Global took third place with 50 investments.
By Industry
IT & ITeS companies accounted for $20.4 Billion of the total PE-VC investment pie in 2022, a decrease of 51% when compared with 2021 (which saw
$41.3 Billion being invested). Baring Asia's acquisition of 85% stake in BPO services firm InterGlobe Technologies for $810 million topped the IT & ITeS list, followed by the $805
million fundraise by Dailyhunt (from Sumeru Ventures, Luxor Capital, Ontario
Teachers Pension Plan, Sofina, Baillie Gifford, and CPPIB) and the $700
million fundraise by food delivery platform Swiggy (led by Invesco).
The BFSI industry attracted $5.2 Billion during 2022 - a 20% increase from
the $4.4 Billion raised during the previous year. Investments in the
industry were led by Yes Bank's $1,100 million fundraise from Advent
International and Carlyle Group. This was followed by the $593 million acquisition of IDFC AMC by a consortium comprising private equity investors
GIC, ChrysCapital, and others.
The Healthcare & Life Sciences industry saw $4.1 Billion worth of investments in 2022 - a 14% increase compared to the $3.6 Billion invested in 2021. Healthcare & Life Sciences investments were led by global private equity firm Advent International's acquisition of 50.1% stake in Hyderabad-based Suven Pharmaceuticals (for about $762 million) and Asian Institute of Gastroenterology's $316 million fundraise (from Baring Asia) and the $315 million acquisition of Sahyadri Hospitals by Canada-based Ontario Teachers Pension Plan.
"Given the global economic deceleration triggered by the US interest rate hikes, a dip from the lofty investment levels of 2021 was an expected one," noted Arun Natarajan, Founder, Venture Intelligence. "The fact that PE-VC investments in industries like BFSI and Healthcare & Life Sciences during 2022 ended significantly higher than in 2021, indicates a shift away from the obsession that investors had with digital technologies during the previous two years. This diversification is quite healthy for the overall ecosystem and will allow companies from other sectors to receive more attention from investors," he added.
Venture Intelligence is India's longest-serving provider of data and analysis on Private
Company Financials, Transactions (private equity, venture capital, and
M&A) & their Valuations in India.
(Venture Intelligence Subscribers will be mailed detailed reports of the PE-VC action during 2022
in the next few days.)