India Limited Partners Summit 2022 | Mosaic Media Ventures Pvt. Ltd. | 17 February 2022 | Online

As foretold, India is finally delivering a big bang exit year for Limited Partners (LPs)--those investors who provide capital to private equity (PE) and venture capital (VC) funds.

The influx of global liquidity into India combined has played out twofold. One, it is making it easier for PE and VC firms to raise new capital. Second, it has also led to a frenzy in the capital markets, allowing HNIs to book profits and divert a significant chunk of that capital into the domestic alternative investment industry.

India is also set to benefit from the pivot from China. Many funds are shifting their allocation from China to India, in light of the Chinese government crackdown on certain segments and industrialists.

Moreover, following the successful listings of VC-backed unicorns such as Nykaa and Fino Paytech, there was continued strong investor interest for VC-backed, new-age companies like Zomato, PayTM, Policy Bazaar, and others looking to complete their listings. It's hardly a surprise, then, that the amount of money returned to LPs this year has exceeded the past three years combined.

PE/VC deal activity in Calendar 2021 has significantly exceeded previous all-time highs. PE/VC investments have recorded $65.6 billion in 2021 till October end, 38% higher than the previous annual high recorded in 2020, and exits have recorded $38.7 billion, 43% higher than the previous calendar high recorded in 2018, according to a report by the Indian Private Equity & Venture Capital Association (IVCA) and consultancy firm EY.

On a year-on-year (y-o-y) basis, too, exits recorded more than a seven-fold increase in terms of value in the first half of 2021 (1H21) compared to 1H20 and 2H20 ($22.5 billion vs. $3 billion in 1H20 and $3.1 billion in 2H20), and more than 3.7 times the value recorded in entire 2020. This is also the highest half-yearly value of exits and the second-highest on an annual basis. The number of exits in 1H21 (118 exits) was 82% higher compared to 1H20 (65 exits) and 37% higher compared to 2H20 (86 deals), according to IVCA and EY.

Exits via strategic sale were the highest with $12.7 billion recorded across 29 deals, accounting for 57% of all exits in 1H21 which is mainly on account of the large GlobalLogic-Hitachi deal worth $8.6 billion. Next in line were exits via secondary sale (sale to other PE funds) at $4.5 billion (31 deals) that recorded the highest ever half-yearly value and four times the value recorded in entire 2020. Open market exits recorded 38 deals worth $2.9 billion, the IVCA and EY report noted. PE-backed IPOs too recorded the highest ever half-yearly value of exits in 1H21 and second highest in terms of number of IPOs, which saw PE funds garner US$1.6 billion in sale proceeds across13 IPOs.

Going forward, what does this mean for LP allocation going forward? The IPO boom has also come as a booster shot to the HNI community, which will have implications for the domestic LP ecosystem. Already, significant HNI money has been poured into domestic funds such as Sixth Sense, 3one4 Capital, and others. This has also turbocharged the angel investment community – which has seen exponential growth this year.

2022 Speakers

Ajit Kumar
Managing Partner, Evolvence India Fund

Amit Dixit
Head of Asia Private Equity, Blackstone

Anshul Jain
Managing Director, Lighthouse Funds

Anirudh A Damani
Director, Artha India Ventures

Craig Gifford
Head of South Asia Private Equity Funds, CDC Group

Dominic Goh
Principal, Harbourvest Partners

Gopal Srinivasan
Chairman, TVS Capital Funds Limited

Ishpreet Gandhi
Founder and Managing Partner, Stride Ventures

Jai Rupani
Chief Investment Officer, Dinesh Hinduja Family Office

MD Ranganath
President, Catamaran

Mihir Vora
Chief Investment Officer & Senior Director, Max Life Insurance

Michael Liu
Managing Director, Portfolio Advisors

Milind Joshi
India Partner, Global Infrastructure Partners

Nithya Easwaran
Managing Director, Multiples Alternate Asset Management

Neha Grover
South Asia Lead, Private Equity, International Finance Corporation

Padmanabhan Raja Jaishankar
Managing Director, IIFCL

Padmanabh Sinha
Executive Director & CIO - Private Equity, National Investment and Infrastructure Fund (NIIF)

Praneet Garg
Managing Director, Asia Alternatives (Hong Kong)

Pushkar Kulkarni
Managing Director, CPP Investments

Dr. Ruchi Dana
Partner & Executive Board Member, DANA Group

Radhika Rajan
Executive Vice President, DSP Investments

Siddarth Pai
Founding Partner, Chief Financial Officer & ESG Officer, 3one4 Capital

Sunil Mishra
Partner, Adams Street Partners & Vice-Chairman, Singapore Venture Capital & Private Equity Association

Tinaz K. Mistry
Investment Manager, Mistry Family Office

Vishal Mahadevia
Managing Director, Head of India, Warburg Pincus

2022 Partners

SESSION PARTNER:
• Stride Ventures

DIGITAL PARTNER:
• Front Office