Exit Options For Private Equity Investors: Key Considerations And Emerging Trends

Introduction

Exit momentum is typically considered as a determinant indicator of investors' confidence in the market. While the year 2018 saw a surge in exits in the private equity (PE) space, the recent slump in the Indian economy has put exit opportunities on hold in the first half of calendar 2019. The exit trends during the calendar 2018 indicated that Indian markets had started showing signs of achieving maturity, however the slowdown in the economy coupled with rising liquidity concerns has triggered a spurt among PE investors seeking alternative exit options. We could therefore expect investors to either adopt a wait-and-watch approach in anticipation of a revival of the Indian public market or possibly move towards strategic negotiated sales to monetise their investments. Data from several studies indicate that PE exits have recorded stake sales worth just $3.1 billion in the first half of calendar 2019 as against $33 billion  in calendar 2018 across a total