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92% PE Investors Will Bat For Infrastructure In 2010

Private equity players are the most upbeat lot when it comes to deal-making appetite in 2010.

Four-fifths of VCCircle's Deal Outlook survey participants say, they will do more deals in 2010. Contrast this with 2009 when many PE funds were not able to close even a single transaction.

While infrastructure and consumption-focused plays -- same as last year -- continue to remain major attractions, number of players looking to invest in these sectors has significantly increased. Around 92 per cent PE funds have voted for infrastructure compared to 47 per cent last year.

Domestic consumption story has an overwhelming support from 72 per cent respondents while only 20 per cent of poll-takers voted for this segment last year. In 2010, more than half of the respondents (57 per cent) say, they are interested in other investment themes such as financial services and manufacturing. Emerging sectors on the PE radar are education, healthcare and clean technology-renewable energy.

With India emerging as one of the fastest growing economies in the world, more private money will find its way into the country. Nearly 64 per cent of the survey respondents feel that there will be an increase in allocation from global private equity funds to India. Only 21 per cent think otherwise.

Source: Realty Plus 92% PE Investors Will Bat For Infrastructure In 2010

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By ugesh sarkar, Section Finance & Investing
Posted on Tue Jan 05, 2010 at 09:42:45 PM EST
It is quite possible that 2010 will bring more new PE funds into India particularly those that will revisit their India entry plans. This trend is somewhat visible with the entry of new funds such as Advent International and Orbimed Advisors. But, at the same time, a handful of funds such as Candover and Engelfield Capital have closed their India offices due to troubles back home.

The other dominant trend that emerged in the survey is that India will continue to be a destination for growth capital deals as against buyout transactions. Around 35 per cent of the respondents felt that control transactions will not increase, while 28 per cent say that they will increase. Last year, PEs felt that buyouts will increase as a result of divestiture of non-core assets but such deals did not materialise.

More deals and more PE capital to flow into India in 2010: That is the verdict from this investor class.

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