New Delhi: Private equity and venture capital investment activity in India moderated in Q1 2026, with deal value and exits easing from recent peaks, while volumes remained resilient despite geopolitical tensions, a report said on Thursday.
The report from EY and the Indian Venture Capital Association said PE/VC investments totalled $13.1 billion in Q12026, easing 19 per cent year on year and 24 per cent quarter on quarter. Deal volumes almost remained flat with 360 transactions in Q12026 versus 366 in the prior year.
Volumes saw a 1 per cent month on month increase from 358 deals in Q42025, said Vivek Soni, Partner and National Leader, Private Equity Services.
“Global sentiments continue to weigh on PE/VC activity, with heightened geopolitical tensions and persistently high crude oil prices creating an environment of caution. While domestic institutional investors have provided resilience to Indian capital markets, sustained depreciation of the rupee against the dollar has triggered intermittent foreign outflows, dampening sentiment,” he added.
Large transactions continued to dominate value as 27 large deals accounted for $8.7 billion, or about two thirds of total investment.
By deal type, buyouts accounted for the largest share of PE/VC activity with $4.3 billion, followed by growth investments at $4.1 billion and start up funding of $3.2 billion. Sector wise, technology attracted the most capital at $2.2 billion, followed by financial services at $2 billion and real estate at $1.9 billion.
Together, these sectors accounted for 47 per cent of overall investments in the quarter.
Over the past decade, PE/VC investments in the pharmaceutical and medical devices sector have been on an upward trajectory. Since 2016, the sector has attracted $16.4 billion across 303 deals, of which 62 per cent have been recorded in the last five years.
Investments in the real estate and infrastructure asset class moderated by 11 per cent to $3.4 billion in Q12026 from $3.9 billion in Q12025.
Compared to Q42025, pure play PE/VC investments dropped 7 per cent from $10.4 billion, while real estate and infrastructure investments declined by 51 per cent from $6.9 billion. In terms of the number of deals, pure play investments increased by 7 per cent year on year.
(IANS)
