India: PEs/VCs’ hotspot
India received the bulk of the US$16 billion South Asian investments by Venture Capitalists and Private Equities in 2015, according to data from the Singapore Venture Capital & Private Equity Association (SVCA).
The investment comprised US$9 billion from VCs and US$7 billion from PEs in the region, where Sri Lanka was the next beneficiary.
As of August this year, both VCs and PEs have placed US$3 billion each in the South Asian region, said the SVCA chairman Dr Jeffrey Chi.
I am relatively bullish and I think there is a lot happening in India that is very encouraging.
“We see more and more Indian consumers driving the economy and we see more PE/VC invstments going into India in the coming years,” said Dr Chi who is bullish on India and rated it as hotspot along with the United States, China and Southeast Asia.
“There are quite a large number of companies like Flipkart and Paytm being the success stories and the development of e-commerce with consumer becoming more educated to buy things off mobile,” he said.
Meanwhile, Singapore-based PEs/VCs have invested about US$1 billion in Indian start-ups.
India accounts for about 10 per cent of VC and PE investments a year out of the average USD9.6 billion invested out of Singapore.
As of August this year, Singapore’s PEs and VCs have invested US$163 million US$323 million, according data captured by SVCA.
“It is still too early to see how 2016 might end up. Looking at the numbers, I expect a slight decline from last year,” said Dr Chi.
Singapore-based non-resident Indian fund managers have been taking more interest in the Indian market which has a huge potential.
The Chinese PE/VC are at a stage where they definitely beginning to look at outbound investments with India being one of the destination.
They are focusing on markets they feel a little closer to and they are easier to work with such as US and Israel which they feel allow them to generate technology.
“India is interesting and I certainly know of deals that are happening. But there is a little bit of cultural clash,” he said, adding that the Chinese focused destinations were the United States, Israel and South East Asia. fii-new.com
