India In Sight #86
Weekly updates on Indian private markets. Featuring PE/VC Roundup 2024 report by EY-IVCA
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Key reports in this edition:
PE/VC roundup 2024 by IVCA-EY
Transformative transactions in technology services by Avendus
Education through the lens of healthcare by Anand Rathi
Indian startup report for Jan 2025 by Entrackr
The role of Fintech in building Viksit Bharat by EY
KEY DEALS
Equity
Cognida, an enterprise AI startup, raised c.$15 million in a funding round led by Nexus Venture Partners. (February 07, 2025)
Multiples PE acquired a controlling stake in QBurst, a digital product engineering platform, for c.$200 million. (February 06, 2025)
Myntra, an online fashion retailer secured c.$80 million funding from its parent firm Flipkart. (February 06, 2025)
TrueFoundry, an AI deployment and scaling platform, raised c.$19 million in its Series A funding round led by Intel Capital. Other investors include Eniac Ventures, Surge, Jump Capital, and CXOs. (February 06, 2025)
Cashfree Payments, a payments solutions provider, raised c.$53 million in its Series C funding round led by Krafton, a South Korean digital entertainment company. Other investor include Apis Partners. (February 05, 2025)
Avendus PE acquired a minority stake in La Renon Healthcare, a pharmaceutical company, for c.$19 million. (February 04, 2025)
Bhavish Aggarwal (Founder, Ola) launched Krutrim AI Labs, an AI research lab to develop AI specifically designed for India, with an investment of c.$235 million. (February 04, 2025)
Equirus Capital, a financial services firm, acquired Credence Family Office, a wealth management business, from TIW Private Equity for c.$12 million. (February 03, 2025)
Apex Kidney Care, a dialysis service provider, raised c.$9 million from Blue Earth Capital AG, a Swiss fund, for an undisclosed equity stake. (February 03, 2025)
Shadowfax, a logistics firm, raised c.$17 million in its Series F funding round from Mirae Asset and Nokia Growth Partners at c.$710 million valuation. (February 03, 2025)
[Expected] ChrysCapital is looking to invest c.$100-$150 million in Dhan, a stock market investment and trading platform, with the aim of scaling it to a unicorn level. (February 08, 2025)
[Expected] Euler Motors, a commercial EV manufacturer, is looking to raise c.$50 million in its Series D round, likely to be led by Hero MotoCorp. (February 06, 2025)
Credit
Auxilo, an education-focused NBFC, raised c.$6 million in debt from Motilal Oswal. (February 07, 2025)
Muthoot FinCorp is looking to raise c.$47 million through retail bonds with effective yield of 9-10%. (February 04, 2025)
CreditAccess Grameen, a microfinance institution, secured c.$50 million in debt funding from IFC. (February 03, 2025)
KEY FUNDS AND FUNDRAISES
ValueQuest, a public markets focused investor, marked the final close of its first private equity fund, at c.$160 million (2x the target corpus). (February 07, 2025)
Info Edge, an Indian IT group and investor, launched a new alternative investment fund with a corpus of c.$115 million. (February 05, 2025)
MARKET INSIGHTS & RESEARCH
Reports
IVCA-EY’s ‘PE/VC Roundup 2024’ showcases that PE/VC investments in India rebounded in 2024, rising 5% YoY to $56B, driven by buyouts in infra, tech, and financial services ($9.4B vs. $3.5B in 2023). Deal volume surged 54% to 1,350+ deals, fueled by a 250%+ rise in credit deals ($10.8B). Infra remained the top sector ($12.1B), followed by financial services ($9.0B) and real estate ($8.8B). Exits grew 7% to $26.7B, with PE-backed IPOs up 130%.
Avendus’ report on ‘Transformative transactions in technology services’ highlights that the tech services sector is undergoing a major transformation, with $330B+ in deal-making over the last decade and a doubling of $1B+ deals since 2013. PE dominates 50% of deals, achieving 3x+ MOIC returns. Key growth areas include Digital Engineering, Cloud, AI/Analytics, and Healthcare RCM.
Anand Rathi’s report on ‘Education through the lens of healthcare’ highlights how India's formal education sector is undergoing structural transformation, inspired by the privatization model in healthcare. The sector has attracted c.$10B in FDI (2000-2024) but remains restricted by not-for-profit mandates, unlike healthcare, where 100% FDI and IPOs have driven growth.
Entrackr’s report on ‘Indian startups for Jan 2025’ outlines a strong rebound in venture funding, with c.$1.8B raised across 128 deals, the highest in six months. Growth and late-stage startups dominated, securing $1.5B, while early-stage firms raised $261M. Healthtech ($405M) led funding, followed by AI ($356M) and Proptech ($278M).
EY’s report on ‘The role of Fintech in building Viksit Bharat’ highlights that the Indian fintech sector is projected to generate $180-200B in revenue by 2030, with digital payment volumes leading globally with c.50% share and ranking third globally in the number of fintech firms. Key growth drivers include rising disposable income, increased digital adoption, and regulatory support.
KPMG’s global tech report series focusses on 1) Industrial manufacturing; 2) Energy; 3) Technology insights. 76% of tech executives report strong cost-benefit forecasting, reinforcing confidence in strategic digital investments. AI adoption is also addressing talent shortages, with 80% of executives reporting improved productivity.
Articles
SEBI’s new regulations mandating equal treatment of all investors have created challenges for PE and VC firms, as they can no longer offer preferential terms to large investors. This could impact fund structures, co-investment rights, and investor payouts. Read more.
PE firms are increasingly adopting shared services and GCCs to enhance efficiency, reduce costs, and drive enterprise value across their portfolio companies. This model enables 50-60% cost savings through labor arbitrage, 10-15% via standardization, and 12-18% through automation. Read more.
India is advancing its renewable energy goals, targeting 500 GW capacity by 2030, while still relying on coal (85% of energy mix) and crude oil imports (85% dependency). Green hydrogen ($2.4B investment), solar, and natural gas expansion are driving the transition. Power distribution upgrades, carbon capture, and nuclear energy (Bharat Small Reactors) are gaining momentum. Read more.
This note analyzes the finance sector across PE and VC, Mutual Funds, Banks, and Investment Banking (IB), each differing in capital independence, knowledge depth, and business impact. PE stands out for its autonomy and transformative role, managing long-term capital from LPs. Read more.
AI is revolutionizing education in India, enabling personalized learning, adaptive assessments, and multilingual education. Edtech platforms are automating admin tasks, allowing more focus on planning and student engagement. Read more.
KPIs
India’s indirect tax collection is projected to grow 8.3% in FY26, driven by higher GST revenues from strong urban consumption. Corporate tax collections are expected to rise 10.4%, while government spending is set to increase 7.4%. The fiscal deficit has been revised down to 4.8% of GDP.
RBI projects India’s GDP to grow 6.7% in FY26, with quarterly estimates ranging between 6.5%-7%. The economic survey warns of global risks affecting growth and stresses the need for deregulation to meet long-term goals. For the current fiscal year, GDP growth is expected at 6.4%, hindered by sluggish manufacturing and investment levels.
India's liquidity deficit has eased significantly after the RBI introduced aggressive liquidity measures to counter slowing economic growth. The deficit fell reducing banks' overnight borrowing costs and bringing rates in line with the RBI’s policy repurchase rate.
WEEKLY MARKET UPDATE (w/c February 03, 2025)
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