The value of the PE-VC agreement in August was 1/3 of the total investments in July
CHENNAI: Even when the internet companies of the new era kept their fundraising momentum in August , the absence of high-value private capital (PE) and venture capital investments (VC) in the central sectors knocked down private markets.
PE-VC Agreement value in August was just one-third of the investments in July , and also fell almost 36% compared to the same month last year, according to data from the research firm Venture Intelligence.
44 deals worth around $1.8 billion in investments were recorded in August compared to almost $6 billion (from 53 deals) in July , and $2.8 billion (68 deals) in the same month last year.
Private markets, especially the Internet and mobile technology companies, were not affected by macro factors as dry dust levels (allocated capital not invested) with PE-VC companies remain high, industry officials said .
Companies in the new economy, as they are known, have remained strong so far in 2019 despite global and local counter winds, such as trade wars, the slowdown in GDP growth, the weakening of the rupee, etc. they said.
However, as we have seen in the past, if exits (IPOs) are depleted due to prolonged nervousness or a decrease in public markets, it will tend to have a 'slow' impact, Arun Natarajan, founder of Venture Intelligence, said.
11 exits worth $473 million were recorded in August , compared to nine exit deals worth almost $2 billion in July .
With regard to the fall of infrastructure and other agreements of the central sector, Natarajan believes that sovereign wealth funds and pension funds remain committed to the history of India, and cannot be carried away by short-term trends and feelings .
B2C technology players like Faasos, Cred and Meesho led the list of the best deals this month, raising rounds of more than $ 100 million each from the list of frontline investors.
Rajat Tandon, president of the Indian Association of Private Equity and Venture Capital (IVCA), says that the reversal of the additional FPI surcharge helped public markets recover, the sentiment in the space of the Alternative Investment Fund (IDA) remains moderate as Category I and II AIFs that trade unlisted securities will attract the surcharge.
However, policy changes, including the FIA exemption from Categories I and II of the angel tax, will drive the industry toward even better results in the latter part of the year, Tandon said.