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INDIA IS EXPERIENCING a second wave of interest in private equity – the first was in the late 1990s – and activity in the sector should continue to gather strength. In the third quarter of 2005 several high-profile deals were agreed. Newbridge Capital invested $100 million in the holding company of the Sriram Group, a dominant player in truck financing. Local firm ICICI Ventures paid $59.8 million to buy out the refractory business of Associated Cement Companies. Media company Nimbus Communications and drug research company Perlecan Pharma each raised $45 million from private-equity investors. These deals and various smaller ones helped swell the quarterly total of investments to $528 million, the highest ever for private equity in India.
Until recently deal flow was sedate, according to local research firm Venture Intelligence. Eight companies had raised a modest $90 million in the third quarter of 2004 and the initial prospects for this year did not seem promising. But the situation has turned around quickly. “The total value of private-equity and venture capital deals in the first nine months of this year has already crossed $1.2