Last Update: January 28, 2023, 16:52 IST
Investments were down 29 per cent by value compared to $75.9 billion in 2021.
EY says that even after the fall, the year 2022 was the second best year for India in terms of long-term investors placing bets on growing Indian companies.
Investment by private equity and venture capital funds is set to drop by almost a third to US$54.2 billion in 2022, characterized by a ‘funding winter’ after consecutive years of boom. It was the second best for the year even after the fall India said a report by industry lobby Ivka and consultancy firm EY in the context of bets placed on growing Indian companies by long-term investors.
Investments were down 29 per cent by value in 2021 at USD 75.9 billion, while there was a 4.6 per cent decline in volume to 1,211 transactions, the report said, adding that large deals There has been a decline. decline.
The firm’s partner Vivek Soni said high levels of uncertainty driven by inflationary woes, fears of a recession, rising cost of capital and geo-strategic challenges have dampened investor interest.
With 99 funds dedicated to India raising USD 17.4 billion in 2022, and a high level of dry powder available globally, there is potential for a rebound in activity, he said.
He added, “We expect the startup space to continue to receive large investments, albeit at lower valuation multiples from 2021. There is a high probability that Indian PE/VC investments in 2023 will meaningfully exceed 2022 levels.” Will happen.”
Factors to watch in the future include a recession in the developed world, the re-emergence of inflation, any flare-ups in geopolitical conflicts, and potentially new and infectious COVID-19 variants.
The report states that in 2022, the financial services sector recorded maximum interest in terms of value and volume with 249 deals valued at USD 10.8 billion.
On the exit front, there was a decline of 55 per cent at USD 18.3 billion through 249 deals, it said, adding that this was due to the absence of large strategic and secondary deals.
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(This story has not been edited by News18 staff and is published from a syndicated news agency feed)