Indian private equity investments fall 29%

The largest third quarter private equity deal was JPMorgan’s $250m investment in Café Coffee Day, but the bulk of deals were venture capital investments.

Third quarter private equity investments fell 29 percent from the same period last year to $3 billion, according to Venture Intelligence, an Indian private equity-focused research service. 

However, total investments for the first nine months of 2008 were slightly higher than the amount invested in the first nine months last year. Roughly $9.7 billion has been invested in 330 deals this year, while a total of $9.5 billion was invested by private equity firms in India through September 2007.

About 30 percent of the deals done in the third quarter 2008 were in the IT and IT-enabled sectors. Financial sector deals made up 12 percent, while healthcare and life sciences followed with 9 percent of total deals.

Pre-IPO placements and buyouts completely dried up in the last three months, said Arun Natarajan, founder and chief executive of Venture Intelligence. Venture capital investments accounted for about 40 percent of total deal volume and late stage investments a third of all deals made.

The largest third quarter private equity investment was JPMorgan’s $250 million investment in Café Coffee Day, a coffee conglomerate involved in procurement, processing and retailing. 

India focused private equity funds raised a total of $1.8 billion during the third quarter, the largest of which was a $750 million growth capital fund closed by Sequoia Capital.