India In Sight #77
Weekly updates on Indian private markets.
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Key reports in this edition:
India’s MedTech industry by EY
Building sustainable chemical manufacturing in India by PWC and ICC
Driving innovation & sustainability in clean energy by Grant Thornton and CII
Steel pipes and tubes sector report by Systematix
Driving Make in India by KPMG and HSBC
Cross-industry tidings by Exencial
India Pulse by MUFG
KEY DEALS
Equity
WoodenStreet, an omni-channel furniture platform, raised c.$43 million in its Series C funding round from PremjiInvest, at an estimated valuation of c.$190 million. The funds will be used for offline expansion and to open new stores in tier-1 and tier-2 cities. (December 07, 2024)
Orange Health Labs, a diagnostic lab and healthcare platform, raised c.$12 million in a funding round led by Amazon Sambhav Venture Fund, Amazon’s India focused corporate VC arm. (December 06, 2024)
Translumina Therapeutics, an Everstone-backed cardiac stent and medical devices maker, raised pre-IPO funding from domestic and international family offices. The financial details of the transaction were not disclosed. (December 06, 2024)
Laurus Labs, a pharmaceuticals company, to raise c.$14 million in equity from Eight Roads Ventures and F-Prime Capital for its biotech unit. (December 06, 2024)
Ultraviolette, an electric motorcycle manufacturer, secured a commitment of c.$16 million from Zoho Corporation, Lingotto Co-Invest Fund, and Mudhal Partners. (December 05, 2024)
Fairfax India Holdings, an India-focused investment arm of Fairfax, to acquire an additional c.10% stake in Bangalore International Airport (BIAL) for c.$250 million from Siemens Project Ventures. Fairfax will own c.74% in BIAL after the transaction. (December 04, 2024)
Glow, a solar energy startup, secured a commitment of c.$30 million in a funding round co-led by Framework and Union Square Ventures, for solar power expansion in Rajasthan. Glow has three solar farms operating live in Rajasthan. (December 04, 2024)
Enterpret, an AI-enabled customer feedback intelligence platform, raised c.$20 million in its Series A funding round led by Canaan Partners, a US-based VC firm. Other investors include Kleiner Perkins, Peak XV, Wing Ventures, and Recall Capital. (December 04, 2024)
Mintifi, a supply chain finance fintech, raised $80 million for a c.11% stake from Prosus. Mintifi partners with corporates like Tata Motors and Jockey, offering short-term loans to their distributors. This investment follows Mintifi's $110 million funding round in March 2023. (December 03, 2024)
Vastu Housing Financing, a housing finance company, raised c.$100 million from Prosus, a Dutch technology investor. (December 02, 2024)
[Expected] Apna Mart, an omnichannel grocery and FMCG chain, is looking to raise c.$15-20 million in a funding round co-led by Fundamentum Partnership and Accel. (December 06, 2024)
Other Credit Deals and Issuances
DME Development Limited, a fully-owned special purpose vehicle of the National Highways Authority of India (NHAI), is looking to raise c.$120 million through issuance of green bonds. (December 05, 2024)
KEY FUNDS AND FUNDRAISES
Abyro Capital, an early-stage venture capital firm, launched its maiden India and US focused fund with a target corpus of c.$25 million. (December 04, 2024)
MARKET INSIGHTS & RESEARCH
Reports
EY’s report on ‘India’s MedTech industry’ highlights that the industry is poised to grow from $12B in 2023 to $50B by 2030, driven by increasing chronic disease prevalence, rising healthcare awareness, and favorable policies. Exports grew at a 14% CAGR, reaching $3.8B in FY2024. The growth is driven by digital health tech, AI-enabled devices, and rising PE and FDI investments ($1.2B in 2024).
PWC and ICC’s report on ‘Building sustainable chemical manufacturing in India’ highlights India's chemical sector as a $220B industry employing 2M people, expected to grow to $1T by 2040. Key strategies include adopting green chemistry, circular economy practices, and renewable feedstocks to lower GHG emissions. Innovations like carbon capture, sustainable finance and incentives are critical.
Grant Thornton and CII report: ‘Driving innovation and sustainability in clean energy development’ marks that India is a key player, aiming for 500 GW of non-fossil capacity by 2030, with initiatives like the National Solar and Hydrogen Missions. While developed nations target net zero by 2050, India and China align their 2070 and 2060 goals with sustainable growth strategies.
Systematix’s report ‘Pipelines of Progress’ outlines that India's steel pipes and tubes sector is set to grow at a 7% CAGR from FY24 to FY29, driven by rising demand in infrastructure, irrigation, and oil & gas. Exports grew at a 7% CAGR, reaching 1.6M tons in FY24, while government initiatives like AMRUT and Jal Jeevan Mission are boosting domestic consumption.
KPMG and HSBC’s report ‘Driving Make in India’ highlights India's strategic initiatives across sectors like electronics, railways, infra, space, logistics, space, battery storage, data center etc. to boost manufacturing and innovation through incentives like the PLI scheme, allocating up c.$10B for semiconductors and c.$2.4B for solar sector. Green energy capacity surged led by solar (8GW in 2021 to 60GW (2023).
KPMG and CII’s report on ‘Building future business leaders’ states that family-owned businesses are key drivers of growth and employment. However, only 14% of such businesses in India survive into the third generation, highlighting a lack of formal succession planning. To ensure perpetuity, senior generations must actively involve, mentor, and align the next generation with the business's vision and goals.
Articles
VC funding surged by c.50% in 9M 2024. In 2025, VCs are expected to focus on AI, fintech, digital banking, climate fintechs, embedded finance, cross-border payments, and innovative products. [Paywall] Read more.
India's startup funding is shifting towards growth and late-stage investments, with early-stage funding dropping to $3B across 1,533 deals in 2024 (vs $4B and 2,137 in 2023). Late-stage funding rose to $13B but fall in early-stage activity slightly reduced overall startup funding to $15.9B from $16.5B YoY. Read more.
Government initiatives like IndiaAI Mission and Future Skills aim to establish India as a global AI leader and investment hub. While over 200 GenAI startups have raised $1.2B, founders and investors advocate for sector-specific AI regulations instead of uniform policies. [Paywall] Read more.
Startups in India are leading in AI adoption, including GenAI, while large enterprises and GCCs lag behind, with only 30-40% and 15-20% of GenAI projects progressing to production, respectively. However, enterprise adoption is gradually improving. [Paywall] Read more.
Indian markets saw a rebound in foreign fund inflows with $156M directed to large-cap funds after two months of consistent outflows. However, mid-cap funds continued facing redemptions, totaling $900M over 22 weeks, while broader foreign inflow cycles appear to have peaked. Read more.
RBI is strengthening regulations for PE and VC investments in NBFCs. It is urging these funds to replace their appointed 'observers' with formal directors to enhance accountability, improve governance, and mitigate risks related to fraud or misconduct. [Paywall] Read more.
India's IPO market is poised for a landmark year in 2024, with 298 companies raising a record c.$16B, driven by economic growth and favorable market conditions. This marks a 22% increase in IPOs and a 140% jump in fundraising compared to 2023. Read more.
India has attracted over $1T in FDI since April 2000, with Mauritius, Singapore, and the US as top investors in sectors like services, software, and telecom. FDI inflows surged post-2014, and experts anticipate further growth due to robust economy supportive government policies. Read more.
KPIs
Exencial Industry Tidings report highlights mixed trends across industries. Agriculture showed a 4.1% rise in Rabi sowing, while sugar production dropped 35.4%. Renewable energy saw significant gains, with solar power up 40.4%, but wind energy declined 15.4%. Premium alcohol markets demonstrated robust growth, while FMCG demand weakened. Infra activity remained strong - port cargo traffic up 3.8% and aviation passenger traffic growing by 9.8%.
MUFG’s report ‘India Pulse’ outlines a slowdown in India's GDP growth, now forecasted at 6.1% for FY2024/25 and 6.3% for FY2025/26, down from previous estimates. Inflation is expected to average 5% in FY2024/25, prompting the RBI to cut rates by 75 bps starting Feb 2025. The USD/INR is projected to rise gradually to 86.0 by the end of 2025. Government spending, rural consumption, and private investments are showing signs of recovery.
RBI has kept the policy repo rate steady at 6.50%, along with other key rates, and maintained a neutral policy stance. This approach allows flexibility to respond to inflation trends and economic growth as needed.
India's external debt increased by $31 billion, reaching $646.79 billion in 2023, according to the World Bank's International Debt Report. Interest payments surged from $15.08 billion in 2022 to $22.54 billion in 2023. Long-term debt rose by 7% to $498 billion, while short-term debt slightly declined to $126.32 billion.
India is poised for a surge in billionaire entrepreneurs, mirroring China's growth trajectory until 2020. Rapid urbanization, digitalization, and the prominence of family businesses—many of which are publicly listed—are key drivers. Over the past decade, the number of Indian billionaires has more than doubled, with their collective wealth nearly tripling.
WEEKLY MARKET UPDATE (w/c December 02, 2024)
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