PE-VC investments decline 33% to $8.3bn in Q2

Private equity - venture capital (PE-VC) firms invested over $8.3 billion (across 233 deals) in Indian companies during Q2’24, shows data from Venture Intelligence, a research service focused on private company financials, transactions, and their valuations.

The Q2'24 investment amount represents a 33% fall over the $12.4 Billion (across 235 deals) invested in the same period during 2023.

The latest quarterly numbers take the PE-VC investment figures for the first 6 months of 2024 to $14.6 billion (across 431 deals) which is 24 per cent lower compared to the same period in 2023 (which saw $19.2 billion being invested across 495 deals).

When compared to the immediate previous quarter (Jan-Mar 2024, which witnessed $6.4 billion being invested across 198 deals), Q2'24 has witnessed an almost 30 per cent uptick. Deal volumes in Q2'24 - which were flat compared to Q2'23 - were up 18 per cent compared to the immediate previous quarter.

Q2 witnessed 22 mega deals ($100 M+ rounds) worth $5.8 billion, compared to 23 such investments (worth $10.3 Billion) in Q2’23 and 10 such deals (worth $4.0 billion) in the immediate previous quarter.

The largest PE-VC investment in Q2’24 was the $900 million majority stake acquisition in the Chennai and USA-based IT Services firm Altimetrik by TPG Capital. KKR’s $840 million acquisition of the Bengaluru-based medical devices maker HealthiumMedtech was the second biggest deal of the quarter. This was followed by $665 million investment in Quick-Commerce unicorn Zepto by DST Global, Avenir Growth, StepStone Group, Lightspeed Ventures, Nexus Venture Partners and others and the $554 million acquisition of Chennai-headquartered Shriram Housing Finance Ltd (SHFL) by Warburg Pincus.

Talking to Bizz Buzz, Arun Natarajan, founder of Venture Intelligence says, “A key highlight of Q2, ‘24 was the bounce back in mega deals in IT &ITeS, which led the industry to account for over 40 per cent of the PE-VC investments during the period. Not only did e-commerce unicorns like Zepto, Meesho and Lenskart attract significant investments, Q4 '24 also saw IT & BPO services companies like Altimetrik and Infinx as well as SaaS providers like Atlan and Eka Software Solutions attract large PE-VC investments.”

The rising share of majority control/buyout deals in the PE segment continued to sustain during Q2 (accounting for 39 per cent of the investment pie) led by big ticket global investors like TPG, KKR and Warburg Pincus, he added.

Led by the $900 million acquisition of Altimetrik by TPG Capital, IT & ITES emerged as the favorite industry among PE-VC investors in Q2, attracting $3.5 billion (across 125 deals). This was followed by $665 million investment in Quick-Commerce firm Zepto and the $275 million investment in e-commerce startup Meesho (by Tiger Global, Peak XV Partners, Prosus Ventures and Elevation Capital).

The Healthcare & Life Sciences industry came in next, attracting $2.1 billion across 22 deals in Q2. Deals in the industry were led by KKR’s $840 Million acquisition of the Bengaluru-based HealthiumMedtech. This was followed by the $300 million preferential allotment in Apollo Hospitals and the $120 million buyout of Maiva Pharma (by Morgan Stanley and InvAscent).

The BFSI industry attracted about $1.4 billion across 19 deals during Q2. Investments in the industry were led by $554 million acquisition of Chennai-headquartered Shriram Housing Finance Ltd (by Warburg Pincus), followed by $152 million preferential allotments in IIFL Finance by Fairfax Holdings and $151 million in Ugro Capital by Samena Capital.