India-focused venture capital and private equity show resilience amid soft global market

BANGALORE, India, Sept. 25, 2024 (GLOBE NEWSWIRE) -- Preqin, the global leader in alternative assets data, tools, and insights, recently published its Preqin Territory Guide: Private Capital in India 2024 report. It covers private capital* growth in India, assets under management (AUM), deals volume and value, and fundraising data.

Private debt fastest growing private capital asset class in India as businesses need more flexible financing options

As India’s economy grows, many of its fast-growing mid-sized businesses need more flexible financing solutions. This has been influential in making private debt the fastest growing private capital asset class in India. India-focused private debt AUM grew from just below $14bn by the end of 2022 to near $18bn by the end of 2023 – a rise of 29%**. Notably, Preqin data shows that India is now a regional leader in private debt, with AUM higher than each individual market in the Asia-Pacific (APAC) region. Alongside the need for flexible financing, the introduction of regulatory reforms such as the Insolvency and Bankruptcy Code by the Indian government has also increased investor confidence in the private debt market.

Venture capital and private equity buoyed by Indian economy and equity markets

Venture capital is the largest private capital asset class in India due to the country’s strong economic growth and increasingly wealthy, young demographic. At the end of 2023, India-focused venture capital AUM was almost $45bn and accounted for 36% of all India-focused private capital AUM. India-focused venture capital deal volume and value were 961 and close to $14bn in 2023, respectively, while in 2024 to June, deal volume and value were 560 and nearly $6bn, respectively. Moreover, aggregate venture capital fundraising is on track to match 2023 levels, from $2bn in 2023, to $1bn by June 2024.

India-focused private equity remains resilient in a softer global deal market, largely due to India’s public markets outperforming most major economies in recent years. Preqin data shows that exit volumes were 85 in 2023 and 46 in 2024 to June. Aggregate fundraising in 2024 is on course to surpass 2023, with over $1bn raised by June 2024, compared to just below $2bn in 2023.

Harsha Narayan, lead author of the report, says: “India's economy is experiencing rapid growth, fueled by strong GDP expansion, favorable demographics, large-scale infrastructure investment, and economic reforms. As a result, Preqin is seeing increasing numbers of eager global private capital players participating in this market, as India-focused private capital assets under management grows at a significant pace.”

Additional key findings include: 

• Infrastructure deals in India: India-focused infrastructure deal volume and value was supported by government spending in this area, with its 2024 budget targeting capital expenditure of $133bn. There were 92 deals, aggregately worth over $14bn, in 2023. Preqin figures show that there were 77 deals, with an aggregate value of $9.5bn, by June 2024.
• India-focused infrastructure AUM growth: India-focused infrastructure AUM grew from over $8bn by 2022-end to almost $9bn by 2023-end.
• India-focused real estate: By the end of 2023, India accounted for 8% of real estate funds’ APAC-focused AUM. India-focused real estate AUM grew from over $20bn at the end of 2022 to over $21bn by the end of 2023.

Notes to editor:

*The report covers the five key private capital asset classes: private equity, venture capital, private debt, real estate, and infrastructure.

**Preqin has a six-month lag in its AUM analysis to ensure it has a complete dataset as possible when calculating values.

If you would like more information or would like to speak with the report author, please contact Oliver Keyser at oliver.keyser@preqin.com.

About Preqin

Preqin, the Home of Alternatives™, empowers financial professionals who invest in or allocate to alternatives with essential data and insight to make confident decisions. It supports them throughout the entire investment lifecycle with critical information and leading analytics solutions. The company has pioneered rigorous methods of collecting private data for over 20 years, enabling more than 200,000 professionals globally to streamline how they raise capital, source deals and investments, understand performance, and stay informed. For more information visit www.preqin.com.