New Delhi: After two years of shrinking, India’s private equity and venture capital (PE-VC) investments sprung back in 2024, growing about 9 per cent to reach $43 billion across nearly 1,600 deals, and outlook for 2025 remains cautiously optimistic, a latest report said on Wednesday.
The 2024 rebound, primarily fuelled by VC and growth investments while PE dealmaking remained steady, were part of insights in Bain & Company’s ‘India Private Equity Report 2025’, released in collaboration with the Indian Venture and Alternate Capital Association.
“After two years of contraction, India’s PE-VC investments staged a recovery in 2024, growing by approximately 9 per cent to reach $43 billion across close to 1,600 deals, with traditional sectors taking the lead in driving market growth,” it said.
The recovery strengthened India’s position as Asia-Pacific’s second-largest PE-VC destination, capturing about 20 per cent of the total investment and reflecting growing investor confidence in the country’s macroeconomic stability.
While India’s overall increase was primarily driven by VC and growth investments, PE investments maintained stability at $29 billion, as funds navigated high valuations in buoyant public markets, making deal closures more challenging.
“We are seeing a clear shift towards buyout deals, with their share of overall PE deal values rising to about 51 per cent in 2024 from about 37 per cent in 2022. This reflects a strategic emphasis on securing control positions in high-quality assets across sectors, enabled in part by record dry powder, and signals that buyouts could remain central to PE activity as funds seek scalable value creation opportunities,” Prabhav Kashyap, Partner at Bain & Company, said.
Real estate and infrastructure, and select traditional sectors like IT/ITeS, financial services, healthcare-led funding. Other traditional sectors (such as energy, manufacturing) eased after growing for two years, with a subdued year for deal closures amid high valuations driven by public markets and increased competition.
Real estate and infrastructure led the pack at 16 per cent of total PE-VC investment clocking in an approximately 70 per cent surge in deal value over the previous year. Financial services saw a robust growth of about 25 per cent, driven by NBFCs, especially in affordable housing finance, with 14 deals, including seven $100 million-plus transactions in 2024, it said.
Healthcare funding remained resilient and showed “impressive momentum” with an 80 per cent rise in deal volumes, supported by large medtech transactions such as Healthium and Appasamy, increased investments in pharma CDMOs, and continued growth in provider deals.
The IT and IT-enabled services sector recorded “extraordinary growth” of about 300 per cent, led by major deals including Perficient ($3 billion), Altimetrik ($900 million), and GeBBS ($865 million), with significant activity in revenue cycle management investments.
The year 2024 also marked a watershed year for exits. India exits surpassed all other markets in Asia-Pacific with values reaching an impressive $33 billion, representing a 16 per cent year-over-year growth. Investors increasingly looked at buoyant public markets to exit maturing positions.
Public market exits gained prominence, increasing their share from 51 per cent of total exit value in 2023 to 59 per cent in 2024, driven by heightened IPO activity and successful block trades.