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The IVCA-EY Monthly PE/VC Roundup– May’19
Page 2
“Although deal momentum appears to have slowed down in May 2019, with a decisive electoral mandate behind us and a strong deal pipeline in place, we expect investment momentum to pick up in the coming months.
May 2019 recorded some large investments in real assets by sovereign wealth funds and Canadian pension funds. We expect REITS and InvITs to be one of the preferred structures for raising capital by real asset owners/developers in 2019, with large PE funds, pension funds and sovereign wealth funds coming on board as anchor investors. We also expect to see a renewed vigour to the IBC process as the new government which will likely focus on clearing the NPA backlog and providing fresh stimulus which should provide opportunities to PE investors with a stressed assets strategy”
EY Analysis of VCCEdge Data
Our Thoughts
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Monthly Trend Analysis – May’19
Page 4
Investments
► PE/VC investments in May’19 were 54% lower compared to May’18 and 38% lower compared to April’19 (US$2.8 billion in May’19 vs US$6.0 billion in May’18 and US$4.4 billion in April’19) due to fewer large deals. In terms of number of deals, May’19 recorded 24% higher deals compared to May’18 but 25% lower compared to April’19 (82 deals in May’19 vs 66 deals in May’18 and 109 deals in April’19).
► Investments by Sovereign Wealth Funds and Pension Funds account for more than 40% of the total PE/VC investments in May’19.
► There were five large deals (deals of value greater than US$100 million) aggregating to US$1.8 billion in May’19 compared to 16 large deals worth US$5.2 billion in May’18 and 11 large deals worth US$2.9 billion April’19. CDPQ’s buyout of three road assets from Essel Infraprojects for US$500 million was the largest deal followed by GIC’s investment commitment of US$420 million in a 70-30 JV with The Indian Hotels Company Limited to build and acquire hotels in India.
► From the point of view of type of investment, except for Buyouts all other segments recorded significant decline in value invested. In May’19, Buyouts recorded highest value of investments at US$1.4 billion (US$1.2 billion in May’18) followed by investments in Start-ups at US$622 million (US$1.2 billion in May’18). Growth Capital recorded significant decline in value of investments at US$394 million (US$2.2 billion in May’18). PIPE deals were the lowest at US$62 million (US$834 million in May’18).
► From a sector point of view, Infrastructure was the top sector for the month with US$900 million in investments due to the large US$500 million GIC - Essel Infraprojects and US$400 million GIC, KKR – India Grid Trust deals. This was followed by Real Estate that recorded investments worth US$507 million.
EY Analysis of VCCEdge Data
Key Trends - Monthly
Page 5 EY Analysis of VCCEdge Data
Key Trends - Monthly
Exits
► May’19 recorded 11 exits worth US$739 million, 55% lower compared to May’18 and 37% lower compared to April’19. Exits in May’19 were largely dominated by Strategic deals worth US$733 million. There were no exits via Open Market or IPOs.
► The largest exit in May’19 saw Carlyle and Temasek sell their stakes in Global Health Private Limited to Manipal Hospitals for US$377 million, which is the second largest PE/VC exit in the Healthcare sector in India.
► From a sector perspective, Healthcare sector recorded highest value of exits worth US$660 million on account of the large Carlyle, Temasek – Manipal Hospital deal.
Fund Raise
► May’19 recorded total fund raises of US$1.1 billion compared to US$368 million raised in May’18. Fund raise plans worth US$744 million were announced in May’19.
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PE/VC monthly headline trends – Investments
EY Analysis of VCCEdge Data
5,970 1,780 1,690 3,891 4,022 3,336 1,801 3,187 1,777 2,619 7,075 4,445 2,773
66
52
6959 62 64 69 72
88
62
91
109
82
0
20
40
60
80
100
120
-
1,500
3,000
4,500
6,000
7,500
May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19
Total PE/VC Investments
Value (US$m) # of deals
#US$m
4,931
1,620 1,317
3,531
4,012 2,958 1,070 2,825 1,650 2,079 3,556 3,075 1,367
440
15 372
36011
378
723
363
127419
928
369
507
600
146 -
- -
8
- 122
2,591
1,001
900
-
1,500
3,000
4,500
6,000
7,500
May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19
PE/VC Investments – split across asset classes
PE/VC Investments (other sectors) (US$m) Real Estate (US$m) Infrastructure (US$m)
US$m
Page 7
1,638
446 377
1,588
16,029
1,292 393
381 331 381 256
972 739 13
71
283 92
201
7
2 -
-
133
-
1,000
2,000
3,000
May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19
PE/VC Exits – split across asset classes
Other Sectors (US$m) Real Estate (US$m) Infrastructure (US$m)
US$m
EY Analysis of VCCEdge Data
1,638 446 397 1,591 16,029 1364 676 381 331 472 389 1174739
19
11 12
20
913
118
1310
1315
11
-
25
-
1,000
2,000
3,000
May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19
Total PE/VC Exits
Value (US$m) # of exits
#US$m
PE/VC monthly headline trends – Exits
Page 8
PE/VC monthly headline trends – Fund Raise
EY Analysis of VCCEdge Data
368 863 257 2,063 288 641 398 1,440 2,469 285 40 682
1,096
43
5
9
3
5
3 3
10
3
1
4
6
0
2
4
6
8
10
12
-
1,000
2,000
May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19
Fund Raise
Total funds raised (US$m) Total # of funds raised
#US$m
Page 9
109 (34)
161 (12)
299 (9)
353 (5)
442 (2)
< $10m $10m - $20m $20m - $50m $50m - $100m > $100m
Deal Value US$m (Volume)
PE Investments – US$1,367 million over 73 deals
(excluding Infra and Real Estate Investments)
EY Analysis of VCCEdge Data
284 (5)
91 (3)61 (2)
609 (47)
320 (16)
CreditInvestment
Buyout PIPE Start-up/EarlyStage
Growth Capital
Deal Type US$m (Volume)
208
81
102
191
330
456
Others
Power and Utilities
Technology
Healthcare
E-Commerce
Financial Services
Top Sectors by Value US$m
25
9
9
10
10
11
Others
Financial Services
Healthcare
E-Commerce
Technology
Food and Agriculture
Top Sectors by Volume
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9 (1) 39 (3) 39 (1)
1320 (3)
< $10m $10m - $20m $20m - $50m $50m - $100m > $100m
Deal Value US$m (Volume)
Infra and Real Estate Investments – US$1,407 million over 9 deals
EY Analysis of VCCEdge Data
1320 (4)
13 (1)74 (4)
CreditInvestment
Buyout PIPE Financing Startup/EarlyStage
Growth Capital
Deal Type US$m (Volume)
900
507
Infrastructure
Real Estate
By Value US$m
2
7
Infrastructure
Real Estate
By Volume
Page 11
Top PE/VC Investments
Top PE/VC investments excluding Infrastructure and Real Estate in May 2019
EY Analysis of VCCEdge Data
Company PE Investors Sector Stage US$mStake
(%)
Cholamandalam Investment and Finance Co
IFC Financial Services Credit Investment 222 NA
Locodel Solutions Pvt. Ltd. (Grofers.com)
SoftBank, KTB Ventures, Tiger Global and Sequoia Capital
E-Commerce Start-up 220 NA
Omnivore Partners India Fund II
BASF Venture, NDF, CDC, and others
Financial Services Growth Capital 97 NA
CureFit Healthcare Pvt. Ltd.Epiq Capital, IDG Ventures, Kalaari Capital, Accel Growth, and others
Healthcare Start-up 75 NA
Page 12
Top Infra and Real Estate Investments
Company PE Investors Sector Stage US$mStake
(%)
Essel Infraprojects Ltd (3 Road Assets)
CDPQ Infrastructure Buyout 500 100
JV with The Indian Hotels Company Ltd.
GIC RHC Buyout 420 70
India Grid Trust GIC, KKR Infrastructure Buyout 400 57
Paranjape Schemes Construction Ltd., Residential and Commercial Projects in Pune
ASK Property Investment Advisors Pvt. Ltd.
RHC Growth Capital 39 NA
Olympia Cyberspace, a unit of Olympia group
Apollo Global RHC Growth Capital 15 49
EY Analysis of VCCEdge Data
Top Infra and Real Estate investments in May 2019
RHC: Real Estate, Hospitality & Construction
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Exits – US$739 million across 11 deals in May 2019
Exits in May 2019
EY Analysis of VCCEdge Data
0 (0) 0 (0)
733 (9)
5 (2) 0 (0)
IPO Buyback Strategic Secondary Open Market
Exit type US$m (Volume)
0 (3)
5 (2)
11 (2)
61 (1)
660 (3)
Others
Food and agriculture
Business and Professionalservices
Industrial products
Healthcare
Top Sectors US$m (Volume)
RHC: Real Estate, Hospitality & Construction
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Exits – Top Exits
Company Sector Sellers Buyer Exit Type US$m Stake (%)
Global Health Pvt. Ltd. (Medanta)
Healthcare Carlyle, Temasek Manipal Hospitals Strategic 377 46
Cancer Treatment Services International Inc.
Healthcare TPGVarian Medical Systems Inc.
Strategic 283 NA
Milltec Machinery Ltd.Industrial products
Multiples Private EquityAG Growth International Inc.
Strategic 61 42
Highorbit Careers Pvt. Ltd.Business and Professional services
One97 Mobility Fund, India Venture Partners, India Quotient Fund, and other
Info Edge India Ltd. Strategic 12 NA
Bikaji Foods International Ltd.
Food and agriculture
Lighthouse Advisors, Intensive Softshare
Avendus Future Leaders Fund
Secondary 6 NA
EY Analysis of VCCEdge Data
Top Exits in May 2019
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Fund Raise
EY Analysis of VCCEdge Data
Status Fund US$m Strategy
Raised Nexus Venture Partners 353 Early stage
Raised A91 Partners 350Consumer, Healthcare, Financial Services and Technology sectors
Raised Lighthouse 250 Consumer sector
RaisedThe National Bank for Agriculture and Rural Development (NABARD)
100 Agriculture sector
Top Fund Raise/Announcements in May 2019
About EY Private Equity Services
Page 17
Ernst & Young LLP
EY | Assurance | Tax | Transactions | Advisory
About EYEY is a global leader in assurance, tax, transaction and advisory services. The insights and quality services we deliver help build trust and confidence in the capital marketsand in economies the world over. We develop outstanding leaders who team to deliver on our promises to all of our stakeholders. In so doing, we play a critical role inbuilding a better working world for our people, for our clients and for our communities.
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© 2018 Ernst & Young LLP. Published in India. All Rights Reserved.
This publication contains information in summary form and is therefore intended for general guidance only. It is not intended to be a substitute for detailed research or the exercise of professional judgment. Neither EYGM Limited nor any other member of the global Ernst & Young organization can accept any responsibility for loss occasioned to any person acting or refraining from action as a result of any material in this publication. On any specific matter, reference should be made to the appropriate advisor.
EY has been working with the private equity industry for more than 25 years, with approximately 25,000 seasoned professionals worldwide dedicated tothe industry and its business issues. EY serves 74% of the top 300 PE firms included in the Global PEI 300 firms list. Private equity firms, portfoliocompanies and investment funds face complex challenges. They are under pressure to deploy capital amid geopolitical uncertainty, increasedcompetition, higher valuations and rising stakeholder expectations. Successful deals depend on the ability to move faster, drive rapid and strategicgrowth and create greater value throughout the transaction life cycle. EY taps its global network to help source deal opportunities and combines deepsector insights with the proven, innovative strategies that have guided the world’s fastest growing companies.
In India, EY is among the leading providers of advisory, tax, transactions and assurance services. The organization is also the number one professionalservices brand* in India, which is a testimony to our relentless commitment to deliver exceptional client service and create a better working world. EY has16 offices spread across 10 cities in India. Worldwide, our 247,570 people across 150+ countries and 700+ cities are united by our shared values and theirunwavering commitment to quality.
► EY’s India Private Equity Services Practice has been among the top advisors for private equity deals over the past ten years. EY has been
awarded the “Most Active Transaction Advisor” award by Venture Intelligence for 2009-2013 and also the “Investment Bank of the Year,
Private Equity” award by VC Circle in 2012 and 2017. EY was also the top PE advisor in the Venture Intelligence league table in 2018.
► EY’s India Private Equity Services Practice provides value to PE funds and their portfolio companies through its deep sector and service
expertise. EY India is organized around key industry verticals in a matrix structure that enables us to offer an unparalleled blend of industry
expertise and functional skills. We actively track about 15 sectors with sector leads driving our penetration in each of those sectors.
About EY’s Private Equity Services Practice
About IVCA
Page 19
IVCA
About IVCA
The Indian Private Equity & Venture Capital Association (IVCA), is the apex body representing the Alternative Investment Funds (AIFs) in India and promotes stable, long-term capital flow (Private Equity (PE), Venture Capital (VC) and Angel Capital) in India.
With leading VC/ PE firms, institutional investors, banks, corporate advisers, accountants, lawyers and other service providers as members, it serves as a powerful platform for all stakeholders to interact with each other. Being the face of the Industry, it helps establish high standards of governance, ethics, business conduct and professional competence.
With a prime motive to support the ecosystem, it facilitates contact with policy makers, research institutions, universities, trade associations and other relevant organizations. Thus support entrepreneurial activity, innovation and job creation.
Contacts
Rajat TandonPresident, IVCAE: [email protected]
Aakriti Bamniyal
Senior Vice President, IVCAE: [email protected]
