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Southeast Asia Quarterly Private Equity Update: Q1 2024
In Q1 2024, SEA saw a total of 17 deals deploying US$586m. Real estate deals accounted for a third (33%) of PE investments by value, followed by health care (28%) and financial services (23%).
In terms of exits, Q1 2024 saw slower activity. PE-backed exits in SEA fell by c.57% in terms of exit value, compared with Q1 2023. SEA’s IPO market also witnessed muted activity in the quarter. The lack of exits, coupled with the high amounts invested in the region over the past few years, have manifested in a growing secondary market.
Fundraising also remained sluggish during the quarter. Only two SEA-based funds (Fullerton Asia Carbon Action Fund and Asia Partners II) were closed, raising a cumulative sum of US$574m. While private credit is still nascent in SEA, it has tremendous growth potential and opportunity for investors amid subdued deal and fundraising activity. According to the EY PE Pulse Survey – Q1 2024, most of the PE firms globally expect interest rates to remain static, at least in the short term.