Deal momentum up; PE eyeing e-commerce: Grant Thornton

Written By Unknown on Rabu, 11 Maret 2015 | 23.25

Prashant Mehra Partner, Grant Thornton India LLP in an interview to CNBC-TV18's Kritika Saxena spoke on the deal outlook going forward and the value of deals so far.

The deal activity has picked up in momentum now as compared to January and in terms of cross border transactions the average deal value is going up although the deal volume has gone down.

According to him unless there is more clarity of government investments into infra and power, the deal momentum and private investors entering these sectors is still about two quarters away.

Below is the transcript of Prashant Mehra's interview with CNBC-TV18's Kritika Saxena.

Q: The total deal value in February was around USD 2.5 billion. Tell me how has the first two months of the year been compared to the last year? I do believe that the value in volume terms, we have seen an uptick of around 40-36 percent respectively, how has it been if you look at the overall deal value?

A: The two months to 2015 have already witnessed a deal value of about USD 5 billion which is across about 90 deals. This is about 85 percent higher in value as compared to the same period in 2014 and about 25 percent higher in value as compared to the same period in 2013.

The deal activity which appeared sluggish in January'15 as compared to December'14 seems to have picked up momentum now. In terms of cross border transactions, the deal volume has gone down by 65 percent but there is an increase of about 36 percent in deal value, which is perhaps a sign of the markets maturin and thus the average deal value is going up.

Private equity continues to be focused on the e-commerce sector, which shows that the private equity community has a strong faith in the consumer oriented sectors.

Overall, the Budget has come out now - it is an overall progressive Budget, it is striking the right chords of the ease of doing business in India, in terms of the goods and services tax (GST) visibility in terms of the rollout, the planned investments in the infrastructure sector and overall progression which are all steps in the right direction and perhaps this will even further increase the deal momentum in the next couple of months.

Q: If I look at this sectoral demarcation, it seems IT, ITeS, Pharma seems to have led the pack again. When are we going to see an uptick when it comes to infrastructure, power, and energy and of course, now that the Budget is out of the way, there are some areas which have been touched upon -do you feel that deal value and deal momentum in a sector like infrastructure and power could see an uptick?

A: Power and infrastructure, these are sectors where financial gains cannot be seen in isolation. The social gain also needs to be seen, which is why there is a strong public investment, government investment required in these sectors.

The Budget has just come out and there is a fund which is coming out by the Government. So, I think it will be perhaps even two quarters till we see some private investment going into these sectors because firstly there needs to be something on the ground and the private investor confidence needs to build up, which is when we will start seeing transactions happening. So, at least a good two quarters away, if not more.

Q: Also, the private equity deal flow has gone up substantially. How are PE players looking at India or has there been some kind of a change post the Budget? Are you expecting an uptick there as well?

A: Yes, absolutely. I think the private equity community, as I mentioned earlier, has a strong faith in the consumer sector in India, whether it is direct consumer sector or an allied consumer sector in terms of the e-commerce sector. There is a fair bit of activity and momentum in the private equity sector.

With the Budget coming out, the larger private equity players would have instilled their confidence in India and we will see some more sectors gathering momentum as far as the private equity investments are concerned. Also, there is a fair chance that the average deal value for private equity investments will go up further.


Anda sedang membaca artikel tentang

Deal momentum up; PE eyeing e-commerce: Grant Thornton

Dengan url

http://gayafashionshow.blogspot.com/2015/03/deal-momentum-up-pe-eyeing-e-commerce.html

Anda boleh menyebar luaskannya atau mengcopy paste-nya

Deal momentum up; PE eyeing e-commerce: Grant Thornton

namun jangan lupa untuk meletakkan link

Deal momentum up; PE eyeing e-commerce: Grant Thornton

sebagai sumbernya

0 komentar:

Posting Komentar

techieblogger.com Techie Blogger Techie Blogger