PE/VC investments in India rise 46% to $17.1 billion in Q3 2026, deal count falls 9%

Private equity and venture capital (PE/VC) investments in India rose 46% year-on-year to $17.1 billion across 348 deals in the third quarter of 2026, according to the EY-IVCA report.

The investment value was also up 124% from $7.6 billion in the previous quarter. However, the number of deals declined 9% from 384 in Q3 2025, although it increased 44% quarter-on-quarter.

The quarter recorded 36 large deals worth a combined $13 billion, up 97% from $6.6 billion across 26 transactions in the year-ago period. These deals accounted for 76% of total investment value. KKR’s acquisition of Medicover India for $1.4 billion was the largest transaction during the quarter.

By deal type, buyouts attracted the highest investment at $5.1 billion, marking a 419% increase from $1 billion in Q3 2025. Start-up investments followed at $4.8 billion, up 55% from $3.1 billion. Growth investments stood at $3.5 billion, down 2% year-on-year, while PIPE investments rose to $2.6 billion from $1.5 billion. Credit deals declined 54% to $1.2 billion.

Infrastructure was the largest recipient of PE/VC investments, attracting $7.2 billion, followed by healthcare at $3.1 billion and real estate at $1.4 billion. Together, these sectors accounted for 69% of total investments during the quarter.

The report noted that pure-play PE/VC investments stood at $8.5 billion, down 2% from $8.6 billion in Q3 2025. In contrast, investments in real estate and infrastructure increased 182% to $8.6 billion from $3.2 billion in the year-ago quarter.

September was the strongest month for PE/VC investments in 2026, with $7 billion deployed. It also recorded the highest monthly investment value since May 2024, when investments stood at $7.3 billion. The report attributed September’s performance to the highest number of large deals recorded in a month so far this year.

PE/VC-backed IPOs and exits

India has recorded 290 PE/VC-backed IPOs since 2016, with 217 listings — nearly 75% of the total — taking place over the last five years. The year 2021 saw the highest activity, with 44 listings generating around $5.2 billion in exit proceeds.

IPO activity gathered pace again in 2024 and 2025, with 42 PE/VC-backed listings in each year. In 2026, 39 such IPOs have been recorded so far.

Over the last five years, PE/VC investors realised $17.1 billion through 217 IPOs. Financial services led these exits, with $4.2 billion raised across 36 listings, followed by e-commerce at $2.6 billion across 14 IPOs. Automotive, technology and healthcare were the other leading sectors, each recording exits worth more than $1 billion.

The report said IPOs have emerged as an increasingly important exit route for PE/VC investors. However, it expects profitability and earnings visibility to play a greater role in determining IPO success, rather than market sentiment and momentum. It also flagged the possibility of moderate near-term IPO activity amid market volatility and valuation compression in mid-cap and small-cap stocks, while retaining a positive long-term outlook.

Overall, PE/VC exits stood at $10.4 billion across 113 deals in Q3 2026, down 24% from $13.7 billion in Q3 2025. However, exit value was up 107% quarter-on-quarter, while the number of exits rose 35% year-on-year and 105% sequentially.

Open-market exits accounted for the largest share, at $5.9 billion across 54 transactions, representing 57% of total exit value. Secondary exits stood at $2 billion across 15 deals, while strategic exits totalled $1.3 billion across 15 transactions. The quarter also recorded 27 PE-backed IPO exits, the highest number in a quarter, although their combined value declined to $1.2 billion from $8.6 billion in Q3 2025.

The largest exit during the quarter was Avaada Ventures’ repayment of $701 million in debt to Brookfield Renewable. By sector, financial services led exits at $2.8 billion across 21 deals, followed by e-commerce at $2 billion and healthcare at $1.4 billion.

Fundraising and outlook

Fundraising activity totalled $6.4 billion across 32 fundraises in Q3 2026, compared with $16.2 billion in the year-ago quarter and $4.7 billion in Q2 2026. NIIF Infrastructure Fund II’s $2 billion first close, backed by the Government of India and leading global and Indian institutional investors, was the largest fundraise of the quarter.

Vivek Soni, Partner and National Leader, Private Equity Services at EY India, said investors are expected to remain cautious and selective, prioritising the resilience of future profitability and returns on capital amid inflationary pressures and elevated crude oil prices. He also said the recent repo rate hike by the Reserve Bank of India reflected a proactive approach to these conditions.

May records the lowest investment  in 2026

Soni said that PE/VC investment activity in India remained uneven during the first eight months of 2026. Investments stood at $3.84 billion across 119 deals in January and $3.83 billion across 117 deals in February, before rising to $5.53 billion across 131 deals in March, the highest deal count during the period. Activity moderated in April, with investments falling to $2.86 billion across 85 deals, and hit a low in May at $2.08 billion across 76 deals.

Investments recovered to $2.70 billion across 80 deals in June and further increased to $4.36 billion across 115 deals in July. August recorded the highest monthly investment value so far in 2026 at $5.75 billion, across 99 deals. Overall, PE/VC investments totalled $30.94 billion across 822 deals between January and August 2026.

Also read: Jio Platforms Q2 profit jumps nearly 14% to ₹8,389 crore in first results after blockbuster listing