Private Equity in India: 2009

	2009*	2008	2007
Number of deals	126	438	474
Investment	$1.95bn	$10.8bn	$14.66bn
Avg deal size	$15.43mn	$24.68mn	$30.92mn
Largest deal	$255mn (KKR to Aricent)	$428mn (Providence PE to AB Telecom)	$1bn (Tamasek & Goldman to Bharti Infratel)

** As of August 2009
** Source: Venture Intelligence PE deal database

Clearly there are fewer deals and PE firms are taking longer to make investment. This situation leads to following observations:

• Since most funds have not invested in fresh promoters, second-round funding is getting more attention. Investors are getting more time to manage and reinvest in their existing investments.
• Company valuations are low, offering investors a good deal. This is a good time for buyout firms as companies are hiving off non-performing assets to curb losses. These can now be picked up at reasonable rates, with chances of reaping benefits on them once market conditions improves.
• There are far and few IPOs (4 proposal submission in Q1 ’09 as compared to 25 during corresponding period of ’08), so most investors don’t have an exit option in near future.
• Since there are fewer investments options overseas and India offers a relatively stable investment option, there may be some inflow of funds raised abroad.