Despite the slowdown in the economy, private equity (PE) and venture capital (VC) funds are seen to be investing heavily in India, with the investments expected to reach USD 50 billion by the end of 2019.
As per a report by EY, the total PE/VC investments in the first eight months of 2019 (till August) touched USD 36.7 billion, as compared to the previous high of USD 36.5 billion – which was recorded for the entire year of 2018.
The slowdown in growth, liquidity crunch, depreciation of the currency and pessimistic market sentiment have not hit the seasoned PE investors, stated the report, as the investors are still optimistic about the long-term growth prospects in the Indian economy.
Investments have been usually seen in the infrastructure sector, which is expected to account for around 35 per cent of all the investments by PE/VCs in India this year. The momentum is further propelled by interest from sovereign and pension funds and global buyouts. EY states that in the coming months, the industry is expected to see more buyouts of assets, with the private and the government sectors planning to monetize their assets.