Private equity investment in India down to $11bn in 2008 from $14bn in 2007

Arun Natarajan, founder and CEO of Venture Intelligence, said, '2008 was the first year since 2002 that private equity investments in India have witnessed a year-on-year decline.'

With 107 investments, the IT and ITES sector retained its status as private equity investors' favourite, by deal flow. By amount invested, however, the energy sector came out top, with $1.7bn, closely followed by IT & ITES which attracted almost $1.6bn.

Late stage deals accounted for 38 per cent of deal flow and 51 per cent of the capital invested.

The largest investment reported for 2008 was the $640m raised by Aditya Birla Telecom, a subsidiary of listed mobile telephone services provider Idea Cellular, from Providence Equity Partners for a 20 per cent stake.

Companies based in South India attracted a slightly higher number of investments and their peers in Western India attracted more capital in total.

Looking at the cities, Mumbai-based companies retained top position, with 105 investments worth $3.2bn, followed by Delhi/NCR companies, with 74 investments worth $3bn, and Bangalore companies, with 64 investments and $1.3bn. Hyderabad and Chennai attracting 35 investments each in 2008.

Active private equity investors in India include Sequoia Capital India, Citigroup, IFC, ICICI Venture, Nalanda Capital, NEA-Indo US Ventures, DFJ and Nexus India Capital.

Venture Intelligence includes venture capital investments, but excludes private equity-backed real estate investments.

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