According to a research released on Thursday, venture capital (VC) investment in India increased significantly from $2.9 billion to $4 billion in the April–June period (Q2 2024).
However, within the same time span, VC investment in China fell precipitously, from $13.5 billion to $6.9 billion.
According to a KPMG analysis, VC investment is anticipated to increase further in India, partly due to the nation’s stable government and thriving economy.
Fintech, electric cars, and consumer technologies were among the more conventional investment industries that Indian venture capitalists (VCs) concentrated on during the quarter.
Unlike many other jurisdictions where investment in the consumer-focused technology space has dried up dramatically, India’s population and demographics have kept investment in the space relatively resilient, the report mentioned.
The IPO market in India continued to be robust. The capital markets saw all-time highs during Q2’24, feeding the appetite of venture companies looking to raise funds in the public markets.
“Investors continue to remain optimistic about India and as mentioned in the previous edition, our expectations of VC investments to bounce back are now playing out,” said Nitish Poddar, Partner and National Leader, Private Equity, KPMG in India.
Strong demographics, robust economy and a vibrant capital market are the real drivers behind this optimism.
“Investors will however remain cautious and will continue to back sectors and companies which have a good operating model and an assured path to profitability,” Poddar stated.
The amount of venture capital investment in Asia fell from $20.8 billion to $17.4 billion, mostly due to a downturn in China.
“VC investment experienced significant growth in various jurisdictions within the area. It increased from $1 billion to $2.6 billion in Singapore and from $842 million to $1.1 billion in Japan. According to the results, consumer e-commerce businesses in Asia raised the biggest rounds in Q2 2024.
From $75.4 billion in Q1 to a five-quarter record of $94.3 billion in Q2, global venture capital investment increased.
According to the research, VC investment is anticipated to stay mostly stable internationally heading into Q3, with AI continuing to draw a sizable portion of capital.
