Key Takeaways
- • Indian private equity is shifting from a 'spray and pray' approach to selective, concentrated bets on established businesses, according to fund managers speaking at the Business Standard BFSI Insight Summit in Mumbai.
- • Bain Capital India Advisors chairperson Amit Chandra said the firm targets returns roughly 400-500 basis points above the Nifty, and said India's median and top-quartile PE returns have compared favourably with the Nifty, including in dollar terms.
- • PE and VC investment volumes rose from about $38-40 billion in 2020 to roughly $70-77 billion in 2021 but fell below $40 billion in 2025, while Chandra argued the long-term trend matters more than annual spikes.
- • Multiples Alternate Asset Management CEO Renuka Ramnath said PE firms pursue active ownership, aiming to change portfolio company mindsets toward scale and institutionalisation.
- • Both speakers called for a deeper domestic pool of long-term capital from pension funds, insurers and endowments, with Chandra warning India cannot indefinitely depend on foreign capital.
Summary
India's private equity industry is moving toward a more selective investment model, with fund managers concentrating capital in established businesses, seeking greater influence over strategic decisions and focusing on operational transformation to generate returns. The 'spray and pray' approach, most associated with venture capital, spreads capital across many firms in the hope that a few winners offset losses elsewhere. Renuka Ramnath, founder, managing director and chief executive officer of Multiples Alternate Asset Management, said that as a PE firm, Multiples invests for definitive returns whose methodology is articulated at the time of deal making.
Speaking at the Business Standard BFSI Insight Summit in Mumbai, Ramnath and Amit Chandra, chairperson of Bain Capital India Advisors, described how strategies have evolved alongside India's economic growth. According to Chandra, annual PE and VC deployment has fluctuated sharply, rising from roughly $38-40 billion in 2020 to about $70-77 billion in 2021 before falling below $40 billion in 2025. Before 2010, India's PE industry generally deployed $20-30 billion annually, a level that grew to roughly $30-60 billion over the following 15 years. Chandra argued that returns consistency among established managers has improved more than deployment volumes, saying returns now seem more predictable for well-established players.
Both speakers stressed active ownership. Ramnath said that if PE firms cannot change an entrepreneur's mindset toward greater scale and institutionalisation, they risk being passive partners. Chandra said Bain's most important job is to deliver returns above the stock market, targeting roughly 400-500 basis points above the Nifty. The panel acknowledged the asymmetry of PE returns, where investments can lose most or all capital while winners can multiply invested amounts several times, so strong selection must be paired with enough winners to offset failures.
On artificial intelligence, the panelists said firms should assess how AI could reshape existing businesses. Ramnath cited Multiples' 2018 investment in AI services company Quantify, where relatively simple technologies such as cameras and scanners improved productivity, with AI-driven gains also affecting operating margins. Chandra said every investment now requires an AI audit and expects Bain Capital to focus on AI infrastructure, including semiconductors, data centres and computing capacity, rather than compete for bets on large language models.
Chandra and Ramnath also called for a deeper domestic capital base. Chandra said India cannot depend indefinitely on foreign capital and called for policy encouraging pension funds, insurers and endowments to allocate more to PE. Ramnath noted that funds raising international capital must account for dollar-denominated return expectations, making rupee depreciation an added consideration. Chandra described the exit market as a 'tale of two cities', with segments such as IT services and VC-backed firms facing harder exit conditions, contributing to lower overall exit volumes, while quality assets continue to attract strong interest.
Speaking at the Business Standard BFSI Insight Summit in Mumbai, Ramnath and Amit Chandra, chairperson of Bain Capital India Advisors, described how strategies have evolved alongside India's economic growth. According to Chandra, annual PE and VC deployment has fluctuated sharply, rising from roughly $38-40 billion in 2020 to about $70-77 billion in 2021 before falling below $40 billion in 2025. Before 2010, India's PE industry generally deployed $20-30 billion annually, a level that grew to roughly $30-60 billion over the following 15 years. Chandra argued that returns consistency among established managers has improved more than deployment volumes, saying returns now seem more predictable for well-established players.
Both speakers stressed active ownership. Ramnath said that if PE firms cannot change an entrepreneur's mindset toward greater scale and institutionalisation, they risk being passive partners. Chandra said Bain's most important job is to deliver returns above the stock market, targeting roughly 400-500 basis points above the Nifty. The panel acknowledged the asymmetry of PE returns, where investments can lose most or all capital while winners can multiply invested amounts several times, so strong selection must be paired with enough winners to offset failures.
On artificial intelligence, the panelists said firms should assess how AI could reshape existing businesses. Ramnath cited Multiples' 2018 investment in AI services company Quantify, where relatively simple technologies such as cameras and scanners improved productivity, with AI-driven gains also affecting operating margins. Chandra said every investment now requires an AI audit and expects Bain Capital to focus on AI infrastructure, including semiconductors, data centres and computing capacity, rather than compete for bets on large language models.
Chandra and Ramnath also called for a deeper domestic capital base. Chandra said India cannot depend indefinitely on foreign capital and called for policy encouraging pension funds, insurers and endowments to allocate more to PE. Ramnath noted that funds raising international capital must account for dollar-denominated return expectations, making rupee depreciation an added consideration. Chandra described the exit market as a 'tale of two cities', with segments such as IT services and VC-backed firms facing harder exit conditions, contributing to lower overall exit volumes, while quality assets continue to attract strong interest.
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