India attracts more U.S. PE investment than China

By SiliconIndia   |   Thursday, 29 November 2007, 11:59 Hrs
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Mumbai: Though India has gained over China in terms of total private equity (PE) investments received from the U.S. over the last eight years; China is well ahead of India in terms of PE investments this calendar.

According to a study by Thomson Financial, "India appears to be emerging as a new favorite among global PE investors. Over the last eight years, it has received $2.51 billion in PE investments compared to $2.4 billion in China. Nevertheless, India still lags in terms of growth as PE investments have grown at a compounded annual growth rate (CAGR) of 26.7 percent over the last seven years."

PE investments from the U.S. to China is growing at a CAGR of 36.5 percent (over the last eight years), but private equity investments have grown by 108 percent (through October 2007) compared to a year ago, the study by Thomson said.

U.S. PE firms are among the largest investors and play a pivotal role in the growth of such investments in the two Asian countries. Since 2000, these U.S. firms have constituted 96.8 percent of all PE investments in China and 73.4 percent in India.

Since 2000, China has maintained its lead over India in the total U.S. PE investments of more than 30 percent.

Since the past three years, China's U.S. PE investments are growing at a CAGR of 25 percent, while India has seen 50 percent growth. India has received more PE investments in value terms than China, since 2006.

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