Press release

23 Jan 2020 Mumbai, IN

2019, a record year for PE/VC investments on the back of large investments in infrastructure: IVCA-EY report on a Y-o-Y basis, investments grew 28%

Mumbai, 23 January 2020: Private equity & venture capital investments in 2019 were at an all-time high as per the IVCA EY report. Investment grew 28% on Y-o-Y basis.

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Related topics Private equity
  • Infrastructure sector recorded US$14.5 billion in investments, more than investments received in the previous seven years combined
  • Buyouts at US$16.2 billion emerged for the first time as the leading PE/VC deal type
  • Start-up investments record highest ever investment activity in value and volume with US$7.9 billion invested across 610 deals

Mumbai, 23 January 2020: According to the IVCA-EY monthly PE/VC roundup, 2019 recorded investments worth US$48 billion across 1,037 deals, with investments of US$14.5 billion in infrastructure sector. Exits recorded US$11.5 billion across 156 deals on the back of a pick-up in open market exits.

Vivek Soni, Partner and National Leader Private Equity Services, EY said“2019 was third consecutive record-breaking year for PE/VC investments in India. At ~US$48 billion, PE/VC investments equated to approx. 1.7% of the GDP, which is similar to the Chinese benchmark in 2018. Private capital investments in India have grown at a CAGR of almost 44% over the past three years, and this asset class now appears to have come of age in India. 

The headline trends of 2019 include infrastructure sector emerging as a stand out sector in 2019, accounting for ~30% of all PE/VC investments. Also, for the first-time, buyouts emerged as the largest deal type, accounting for over one-third of PE/VC investments. Going forward, while our outlook for 2020 is positive, we expect investment growth to slow down to about 15%-20% in 2020. We expect most PE/VC investors to continue investing in financial services, IT, e-commerce, retail consumer finance and healthcare. Infrastructure and real estate should continue to attract strong interest from real asset economy investors.

We expect 2020 to be a good year for exits because a huge stock of small and mid-cap companies has built up over the past 18 months where PE/VC investors have a substantial stake. Whether or not an IPO window opens, we expect to see more secondary deals in 2020.

By our estimates, with close to US$50 billion in dry powder waiting to be deployed in India, the long-term growth story of Indian PE/VC market remains positive.”


PE/VC investments in 2019 were at an all-time high in terms of both value and volume. In terms of value, at US$48 billion, PE/VC investments in 2019 grew by 28% over last year (US$37.4 billion in 2018), mainly on account of significant investments in the infrastructure sector which alone accounted for 30% of all investments by value in 2019 compared to 12% in 2018.

(Note: The data includes deals that are announced but are awaiting closure like ADIA, PSP and NIIF’s investment in GVK)

In terms of volume, 2019 recorded 1,037 deals, ~35% increase over last year (769 deals in 2018), 60% of which were in the start-up space. In terms of number of deals, start-ups recorded a 61% increase in deal activity in 2019 compared to last year (378 deals in 2018).

From an asset class perspective, pure play PE/VC investments recorded a decline of 3% while there was a significant increase in investments in the infrastructure and real estate asset classes which recorded an increase of 225% and 33%, respectively, on a y-o-y basis. 2019 recorded the highest ever value of PE/VC investments in the infrastructure (US$14.5 billion vs. US$4.5 billion in 2018) and real estate (US$6.1 billion vs. US$4.6 billion in 2018) sectors.

2019 has been a record year for investments across all deal types, the most prominent being buyouts. For the first time, buyouts have emerged as the primary PE/VC deal type, overtaking growth capital deals and accounting for 34% of all PE/VC investments by value in 2019.

Buyout activity in Indian PE/VC industry has grown from strength-to-strength as India moves towards global norms where buyouts are usually the largest deal type of PE/VC investment. When compared across deal types, buyouts have recorded the largest increase of 56% in terms of value (US$16.2 billion in 2019 vs. US$10.4 billion in 2018). In the past two years, buyouts clocked US$26.7 billion in deal value, which is more than the value of buyouts in the preceding 12 years combined. Also, number of buyouts in 2019 (58 deals) are the highest ever. Once again, this has been driven by significant increase in the value (180% increase y-o-y) and number (123% increase y-o-y) of buyouts in the infrastructure and real estate sectors. Buyouts in the traditional PE/VC space however recorded declines in both value (26% decline y-o-y) and volume (19% decline y-o-y) in 2019.

Growth capital investments, at US$14.5 billion, recorded modest increase of 9% in 2019 (US$14.2 billion in 2018). This too was primarily on account of increase in growth investments in infrastructure and real estate sectors which rose by 136% (US$7.3 billion in 2019 vs. US$3.1 billion in 2018) in terms of value and 97% in terms of volume (59 deals in 2019 vs. 30 deals in 2018). Pure play PE/VC growth capital investments recorded a decline of 26% in terms of value and 13% in terms of volume.

Start-up investments in 2019 were the highest ever in terms of value and volume. 2019 recorded start-up investments worth US$7.9 billion, 22% higher compared to 2018 (US$6.5 billion). Softbank’s investment of US$810 million in OYO was the largest start-up investment in 2019.

At US$5.3 billion, PIPE investments increased by 40% on a y-o-y basis while credit investments at US$3 billion increased by 20%.

As the Indian market matures, PE/VC deals are becoming larger and more complex. There were 111 large deals (value greater than US$100 million) in 2019, aggregating to US$35.2 billion and accounting for 73% of total PE/VC investments made in 2019 compared to 81 large deals aggregating US$27.9 billion in 2018. The value and volume of large deals have been progressively increasing over the past four to five years.

The largest deals during the year saw Brookfield buyout Reliance Jio’s tower arm for US$3.7 billion and Reliance Industries Limited’s East-West pipeline for US$1.9 billion. Brookfield-Reliance Jio’s tower deal was also the largest ever deal in the Indian PE/VC industry.

From a sector point of view, most of the sectors recorded significant increase in PE/VC investments. In 2019, 10 sectors recorded over US$1 billion in PE/VC investments compared to nine in 2018. In 2019, infrastructure sector recorded the highest value of investments at US$14.5 billion (US$4.5 billion in 2018). Five of the top 10 deals in 2019 were in the infrastructure sector.

Notwithstanding recent headwinds faced by the Non-Banking Financial Company (NBFC) sector, PE/VC investment activity in the financial services sector has recorded healthy growth. In 2019, at US$9.1 billion, PE/VC investments in the financial services sector are up by 20% compared to last year. 2019 also recorded the highest ever number of deals in the sector. Further, the number of PE/VC deals in the financial services sector (188 deals) in 2019 is the highest number of deals recorded by any sector, topping the previous high of 184 deals recorded by the e-commerce sector in 2015. This was followed by real estate (US$6.1 billion across 71 deals), a 33% y-o-y increase and e-commerce (US$4.3 billion across 134 deals), which declined by 13% y-o-y.


2019 recorded 156 PE/VC exits worth US$11.5 billion, a decline of ~58% from 2018 (US$27 billion). PE/VC exits in 2018 included the US$16 billion Walmart-Flipkart deal, India’s largest ever PE/VC exit. Adjusting for this one-off deal, PE/VC exits in 2019 have increased by 4%.

With the rebound in capital markets, open market exits have recorded an increase of 171% in 2019 compared to last year. In terms of mode of exit, open market exits were the highest in 2019, at US$4.6 billion, accounting for 41% of all exits by value and the second highest value of open market exits over the past 10 years. Secondary and strategic exits were next in line with deals worth US$2.5 billion and US$2.3 billion, respectively. These are however significantly lower compared to secondary and strategic exits worth US$5 billion and US$18.4 billion, respectively, recorded in 2018.

PE-backed IPOs recorded significant decline with eight IPOs worth US$247 million in 2019 compared to 13 IPOs worth US$876 million in 2019.

The largest exit in 2019 saw OYO’s founder undertake partial buyback of stakes worth around US$1.5 billion from Sequoia and Lightspeed followed by Fairfax selling its 10% stake in ICICI Lombard General Insurance Company Limited for US$732 million.

From a sector perspective, financial services (US$2.9 billion across 24 exits), e-commerce (US$1.9 billion across 10 exits), technology (US$1.7 billion across 19 exits) were the top sectors for PE/VC exits in 2019.

Fund raise

2019 saw US$11.7 billion being raised across 56 fund raises by India focussed PE/VC funds, a 45% increase over 2018 and the highest ever annual raise by India dedicated funds. The fund raise plans announced stood at US$18.3 billion. This further reiterates India’s improving attractiveness for global Limited Partners (LPs) and bullishness of India focused funds as the domestic PE/VC ecosystem flourishes.

The largest fund raise during the year saw Government of India sponsor a US$1.5 billion fund for providing last-mile funding to enable completion of construction of stalled housing projects, followed by Edelweiss Alternative Asset Advisors and Kotak Special Situations Fund raising US$1.3 billion and US$1 billion, respectively, to invest in stressed assets.

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Notes to Editors

About EY

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This news release has been issued by EY Services Limited, a member of the global EY organization that also does not provide any services to clients.

About IVCA

The Indian Private Equity & Venture Capital Association (IVCA), is the apex body promoting the Alternative Investment Funds (AIFs) in India and promotes stable, long-term capital flow (Private Equity (PE), Venture Capital (VC) and Angel Capital) in India.

With leading VC/ PE firms, institutional investors, banks, corporate advisers, accountants, lawyers and other service providers as members, it serves as a powerful platform for all stakeholders to interact with each other. Being the face of the Industry, it helps establish high standards of governance, ethics, business conduct and professional competence.

With a prime motive to support the ecosystem, it facilitates contact with policy makers, research institutions, universities, trade associations and other relevant organizations. Thus, support entrepreneurial activity, innovation and job creation.

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