Billions of dollars pumped by worldwide investors into Mukesh Ambani’s Reliance helped the country’s private equity-venture capital (PE-VC) investments see an uptick in 2020. The annual investments by PE-VC investors had been up only 6.6 per cent to $39.2 billion in 2020 from $36.3 billion in 2019, according to study firm Venture Intelligence. Apart from the strategic investments worth $10.2 billion produced by Google and Facebook in Jio Platforms, the $17.3 billion funding by US-primarily based PE and other worldwide sovereign wealth funds in Jio Platforms, Reliance Retail, and Reliance Digital Fibre Infrastructure Trust accounted for 44 per cent of the total PE-VC funding worth in 2020. In the absence of the funding raised by Reliance, the 2020 investments would have fallen to $21.9 billion. In terms of volume, investors participated in 814 bargains in 2020, down 19.5 per cent from 1,012 bargains in 2019.
Excluding Reliance, the major investments of 2020 incorporated $1 billion into container glass packaging manufacturer Piramal Glass from Blackstone and $603 million in on the internet meals ordering firm Zomato led by Tiger Global and Kora Management, apart from other investors. Importantly, Q4 posted 37 per cent development ($11.1 billion across 211 bargains) in investments on the back of capital infusion in Reliance Retail and Reliance Digital Fibre Infrastructure Trust more than ($8.1 billion in 194 bargains) Q3 and 24 per cent in comparison to the year-ago period with $9 billion across 252 bargains.
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“The accelerated adoption of digital technologies by both consumers and enterprises attracted investors to telecom, media and technology companies, including in sectors like edtech, e-commerce, and financial services,” mentioned Arun Natarajan, Founder, Venture Intelligence. However, geopolitical compulsions, which led to the marked slowing down of investments from Chinese investors in private Indian firms, was an additional crucial ecosystem-altering function of 2020, according to Natarajan.
With respect to VC investments (seed to series F funding in firms significantly less than 10 years old and in late-stage tech small business), there was a drop of 13 per cent in worth and 16 per cent in volume. VC bargains saw $10.7 billion investment across 694 bargains vis-à-vis $12.5 billion in 832 bargains. The recovery in PE-VC deal activity was concentrated on huge ticket bargains (more than $one hundred million) and early-stage investments. While early-stage investments in the fourth quarter elevated 48 per cent in comparison to Q2, the second half of 2020 saw 35 PE-VC investments of more than $one hundred million – following slowing down to 25 such bargains in the initially half.