Investment in Private Equity and Venture Capital Decreases in 2025 due to Volatility, Yet Start-ups and FinTech Sectors Display Tenacity, Reports EY-IVCA
In the first half of 2025, private equity (PE) and venture capital (VC) investments in India saw a significant increase compared to the second half of 2024, reaching a total value of USD 26.4 billion[1][2][3]. This marks an 11% rise from the previous half-year, despite a 19% year-on-year decline compared to the first half of 2024[1][2][3].
Vivek Soni, Partner and National Leader, Private Equity Services, EY India, noted the subdued PE/VC investment activity in the first half of 2025, but expressed optimism for the second half of the year[4]. He attributed the increase in investment value to a recovery driven by higher value pure-play PE/VC deals and marginal growth in real estate and infrastructure sectors[1][2].
Pure-play investments reached USD 18.3 billion in the first half of 2025, accounting for 69% of overall PE/VC activity[1][2]. The largest deal in this period was New Mountain Capital's USD 1.5 billion investment in Access Healthcare Services[5].
Despite the increase in value, the number of deals declined by 9% from the second half of 2024, indicating a focus on larger, higher-quality transactions[1][2]. Start-ups led the investment activity, with USD 6.8 billion across 366 deals in the first half of 2025[1][2].
Financial services have been the most favored sub-sector since 2020, drawing USD 75.4 billion in PE/VC investments since 2015, with 61% coming in the past five years[6]. The Real Estate and Infrastructure sectors attracted USD 8.1 billion in the first half of 2025[1][2].
As we move towards the second half of 2025, the market outlook remains cautiously optimistic but tempered by ongoing macroeconomic volatility. Experts highlight a potential stabilization phase, with private equity and venture capital sectors adapting to macroeconomic conditions, sectoral shifts, and investor sentiment to sustain growth while managing risk[1][2].
[1] EY-IVCA monthly PE/VC roundup [2] Related reports released in mid-2025 [3] Staff India, an international franchise of our brand name Media [4] [Link to the source where Soni's statement was made] [5] [Link to the source for the largest deal in the first half of 2025] [6] [Link to the source for the financial services investment figures]
- Vivek Soni, expressing optimism for the second half of 2025, attributes the growth in investment value to a recovery driven by higher value pure-play PE/VC deals and marginal growth in the real estate and infrastructure sectors.
- Financial services have been the most favored sub-sector since 2020, attracting a significant amount of investment, with USD 75.4 billion drawn since 2015, and 61% of that occurring in the past five years.
- As we move towards the second half of 2025, the market outlook remains optimistic but cautious, with experts suggesting a potential stabilization phase in which the private equity and venture capital sectors adapt to macroeconomic conditions, sectoral shifts, and investor sentiment to sustain growth while managing risk.
