It marked a notable increase of 18% over the month of July 2023 and an increase of 127% compared to the investments made in August 2022.
However, the number of deals in August 2023 declined by 27% compared to the same period last year, said the study.
“In August 2023, growth deals valued at US$2.4 billion were the highest across 14 deals compared to US$176 million invested across nine deals in August 2022, which is a 12-fold increase in value terms. PIPE investments recorded US$2.1 billion across 18 deals in August 2023, a more than 20-fold increase y-o-y in terms of value,” said Vivek Soni, Partner and National Leader, Private Equity Services, EY.
He added, from a sector point of view, infrastructure was the top sector in August 2023, on the back of the large investment by GQG Partners Inc. in Adani Power Limited, recording US$1.8 billion in PE/VC investments across six deals.
“Retail and consumer products was the second largest sector with US$1 billion recorded across four deals. PE/VC exits were at US$4.3 billion across 37 deals, a y-o-y increase of 35% by value. August 2023 has witnessed the highest value of exits during the year so far,” said Soni. The study said that startups are facing a funding winter, with VC investments in 3Q2023 likely to be the lowest in eight quarters but nonetheless, there are some bright spots for India. In the global context, VC investments have declined by 51% in the first half of 2023 compared to the previous year, with the second quarter of 2023 being the weakest in over six quarters.
In India, the situation is even more pronounced, with year-to-date VC investments down by 69%, and the third quarter of 2023 is expected to record the lowest VC investments in eight quarters, as per the analysis.
The slowdown has affected all deal segments, from seed to late-stage growth, said the study.
The analysis pointed out that the decline in the number of new unicorns globally and in India highlights the extent of this slowdown, with only 120 new unicorns in 2023 (compared to 669 in 2022) globally and just one unicorn in India in 2023 (compared to 21 in 2022).
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