Back-to-back deals sealed by RIL accounted for 45% of the total private equity-venture capital (PE-VC) investments in the first nine months of 2020, shows data from research firm Venture Intelligence. RIL’s fundraising has managed to keep the overall decline in PE-VC investment tally in 2020 to a marginal 2% despite the overall strain on the economy due to Covid-19. PE-VC firms invested $26.8 billion across 547 deals in the first nine months of 2020 compared to $27.4 billion across 750 deals in the same period last year. Global private equity and sovereign wealth funds invested around $12.1 billion in RIL’s Jio Platforms ($9.9 bn) and Reliance Retail ($2.3 bn). However with mega investments in Reliance Jio taking a pause in July-September, PE-VC investments in the quarter clocked at $7 bn across 168 deals — a 48% fall compared to the immediately previous quarter and 33% dip from the same period last year. Apart from RIL’s investments, top deals in the third quarter include the stressed assets investment by Varde Partners and Goldman Sachs in coal-based power plant operator RattanIndia Power ($567m) and $500m investment by EQT and Temasek in renewable energy platform O2 Power, among others.
While the PE-VC investment figures are expectedly down on a year-on-year basis, recent weeks have shown that both foreign PE-VC investors as well as established India-dedicated funds are keen to make new investments, Arun Natarajan, founder and MD, Venture Intelligence, said.
Falcon Edge Capital, in particular, has been an active VC investor in recent months, he added, noting that consumer tech ventures in areas like ed-tech, e-commerce etc are attracting lion’s share of investments. At $6.5 billion across 438 deals, VC investments fell 18% in value (and 26% by volume) in the nine months of 2020, compared to the same period last year. However VC investments picked up in July-September clocking $2 billion across 137 deals compared to $1.4 billion across 134 deals in the previous quarter.
“The bounce back in the VC segment, especially the turnaround in seed capital deals, is quite encouraging,” Natarajan said.