The COVID-19 pandemic results in a 60% fall in PE/VC investments in India states EY
The pandemic is largely affecting the Private equity (PE) and Venture capital (VC) investments in India and may fall up to 60% in the year 2020. The future investments which were once driven by the fund-raising activity have also lost its importance and focusing on the figures of march, the private equity, and venture capital have been able to raise only $85million.
The same activities which were once glorifying the profit percent as seen in 2019 were 28 % profit raised to $48 billion, now had a huge impact on the economic activities due to global lockdown and social distancing. The firm also states that the COVID-19 situation, along with domestic issues and taxation policies are causing a huge impact on the InvIT’s and REITS and other related issues over the financial health of some domestic banks and NBFCs, which can become a root cause for the slow growth of PE/VC investments in the short term. According to the reports of EY, the Indian PE and VC investments at $19-26 billion in 2020 have potentially slowed down to 45-60% over 2019.