pe scenario in india

Private Equity scenario in India . .

Upload: raaghav-bhatia

Post on 19-Nov-2014




0 download




Page 1: Pe scenario in india

Private Equity scenario in India . .

Page 2: Pe scenario in india

IntroductionPE industry is about a decade old (1999) .

Benchmarks -2004 The total deal value crossed 1.45 bn USD. (for 1st


2007 Peak deal value of 14 bn USD.

2010 Overtook China (in terms of deal value) for a short while

2012 It currently ranks 6th.

Page 3: Pe scenario in india

4 sequential steps in PE









Page 4: Pe scenario in india

The million $ Q’s .

1.What determines the rate of return on Exit ?

2.Extent of influence of – Fund manager on the exit strategy.b. The sector on the exit strategy.c. Life of the fund.

Page 5: Pe scenario in india

3. Which type of exit generates best return and why

4. Do ‘promoter preferences’ on Exit , matter ?

5. If yes , then how the conflict is resolved ?

6. Is there any connection between entry and exit type ?

Page 6: Pe scenario in india


1. The factors that prevail in the system and are beyond our control.

2. Eg. Global economic slowdown in 2009 .


1. The choice of sector .

2. Selection of firm.

3. How much to invest.

4. Entry strategy .

5. Type of exit .

6. When to exit.


Page 7: Pe scenario in india

How Indian market was Risky for PE funds ?

• Political and regulatory uncertainty

• Weak corporate governance

• Family owned businesses

• Difficulties in exiting through IPO

• Compliance issues

Page 8: Pe scenario in india

Returns from Indian PE

Page 9: Pe scenario in india

Sensex return v/s PE return


Page 10: Pe scenario in india

PE returns across Asia and other countries

Page 11: Pe scenario in india

Positives of PE

• PE helped mid market companies deliver professional services.

• Direct impact on – business model , corporate governance , professional talent management of portfolio companies.

• PE enhanced company’s reputation with banker’s and capital markets.

Page 12: Pe scenario in india


• The PE industry in India is as old as the life span of a typical PE fund.

• Nearly 30% of PE deals likely end up generating negative returns.

• High cost of entry.

• Positive future.