(The author, Nishesh Dalal, is Partner and Private Equity Leader, Deloitte South Asia. The data cited below covers India investments and exits by PE funds and excludes private debt, venture capital, real estate, and infrastructure deals.)
Since 2024, India has surged ahead as the only country in the Asia Pacific that boasts of double-digit growth in both private equity deal value and deal count. This has been driven by an evident investor tilt towards control deals.
Control deals—where a private equity firm acquires a controlling stake in a target company—in India have grown fourfold since 2010, a clear signal that control is not merely trending, but becoming the dominant private equity strategy. In 2024, control deals in India accounted for more than half of the PE activity in the country.
This shift reflects investors’ increasing focus on driving value creation, overseeing financial activities and reducing risks of fraud or mismanagement, amid macroeconomic uncertainties. Deal makers are pursuing scale deals with sophisticated deal structures with acquisitions aimed at consolidating market position and achieving cost and revenue synergies.
Control deals provide PEs with a structured framework and greater certainty around the timing and terms and conditions of their exit, often with “drag along” rights. This helps them plan their exit strategies more effectively and manage risks associated with valuation and market conditions.
Control deals provide PEs greater certainty around the timing and terms and conditions of their exit
PE investors have become transformation architects. Beyond funds, they bring advanced operating models, digital-first processes and institutional-grade governance. They are building companies that are resilient, scalable and globally competitive.
PE-backed firms that embed agility and innovation from day one are outpacing their market peers and setting benchmarks for next-gen value creation. This renewed stress on value creation is redefining exit strategies.
The tilt towards control PE deals combined with the renewed stress on value creation is impacting how PE exits are panning out—in terms of the dominant exit modes, the sectors that are witnessing successful exits, and what makes up for a successful exit.
This is, in a way, redefining exit strategies—ringing in the era of Exit Strategy 2.0.
Dominant exit modes
The Indian PE market has now entered a phase of both caution and creativity. In the first half of 2025, the market announced 22 exits totalling $2.9 billion, according to a Deloitte analysis. This was the slowest first half since 2020 in terms of deal count. The slowdown was most visible in the second quarter, driven by macroeconomic uncertainties following changes in the US tariff policy.
Even in this scenario, the market revealed its adaptability. Trade sales (i.e. sales to strategics) and secondary sales (i.e. sales to PEs) dominated, accounting for 91% of the total number of PE exits in the first half of 2025. This was a sharp shift from the 51% average during 2020-2024. IPO markets in India remained active, but there were fewer PE-backed exits in the first half of 2025.
Resilience is the name of the game. When IPOs are uncertain, PEs have leaned on secondary sales and trade sales. PEs are broadening the playbook to secure liquidity and maximise value in parallel.
- Trade sales: Contributed to 26% of total exits in 2024. Indian corporates and multinationals were active buyers.
- Secondary sales: Sponsor-to-sponsor deals represented 30% of total exit value in 2024. This reflected maturing investments from the 2017–2020 cycle.
- IPOs and block trades: Together, these accounted for 26% of total exit value in 2024. Strong demand was visible in financial services and the consumer sector; and PEs used buoyant public markets to their advantage.
Secondary sales have gained in importance, offering liquidity when IPO markets are volatile or strategic buyers are scarce, making them an essential complement to IPOs and strategic sales.
Why secondary sales are rising
Secondary PE sales in India have increased due to a combination of market maturity, liquidity pressures, and changing investor needs.
- Maturity of PE Ecosystem: As India’s private equity markets have matured, more funds are reaching the end of their typical cycles, prompting early investors and funds to seek exit avenues rather than wait for delayed IPOs or strategic sales.
- Liquidity Constraints: Late-stage funding has become scarcer, and many tech companies are now focused on profitability rather than growth. This shift has delayed expected exit timelines for investors, increasing the need for solutions that provide fast liquidity—like secondary sales.
- Regulatory Pressure: Regulatory changes, including stricter timelines for fund liquidations and closures set by SEBI, have nudged funds to pursue secondary transactions to comply and provide liquidity to Limited Partners.
- Valuation and IPO Trends: The recent boom in public markets and expectation of lucrative IPOs motivate secondary buyers, especially for late-stage, near-IPO companies. Secondary deals are seen as an attractive way to participate at a discount before valuation uplifts.
- Portfolio Management Needs: As funds mature, managers need to actively manage tail-end assets and optimise portfolios, including continuation funds for their best holdings and discounted exits for underperformers.
- Global and Family Office Investors: There’s a marked rise in global buy-side interest and Indian family offices seeking to diversify exposure by entering established, de-risked companies via secondary deals.
Sectors delivering premium outcomes
India’s 2024 exit records demonstrate where value is being created. Financial services, healthcare, and consumer sectors delivered the highest outcomes.
- Financial services: The sector registered $3.5 billion in exits across 24 deals, accounting for 28% of the total deal count.
- Healthcare: Healthcare accounted for 38% of the total exit value, with $6.4 billion, across 15 exits. Transactions spanned IPOs, strategic sales and secondary buyouts.
- Consumer: This sector reaped the rewards of India’s consumption growth story. IPOs captured strong investor interest.
Robust public market windows and strong secondary sales powered these three sectors. They continue to remain magnets for both domestic and global investors.
Strategies behind successful exits
Some of the key strategies that appear to have delivered high returns for India’s top private equity firms are as follows:
- Sector focus on high-growth areas: Technology, manufacturing, financial services, healthcare, drew the most attention. Investments rode tailwinds from digitalisation, telecom growth, and the China Plus One strategy.
- Capitalising on policy reforms: Firms leveraged reforms such as Make in India, production-linked incentives and liberalised FDI norms.
- Increased exit activity and liquidity: Stronger macro conditions and a vibrant public market supported this momentum.
- Strategic investments in scalable start-ups: Funds focused on start-ups with paths to profitability in deep tech, AI and consumer tech. Governance discipline was central.
- Buyout deals at attractive multiples: Indian buyouts remained cheaper than public market valuations. This allowed firms to secure quality assets and generate returns through operational improvements.
- Focus on secondary markets and continuation funds: Sponsors used GP-led secondaries and continuation funds to extend holding periods for high-potential companies.
- Value creation beyond financial engineering: Firms built strong operating teams. Deal-making was no longer enough. Active involvement in strategy, operations and governance became critical.
These strategies reinforced one truth. Value creation is the new currency of exits.
The rise of operating teams
About half of India’s leading PE funds now employ dedicated internal operating teams. These teams include full-time professionals and industry veterans. Others use experts on retainer or external consultants. The trend is clear. Active operational involvement is central to the new model.
Operating teams drive value creation through cross-border M&A, efficiency improvements and scaling via platform models. They support CEOs and boards in delivering measurable improvements. Their impact is measured in terms of financial KPIs, governance, reporting quality and the ability to detect problems early.
PE-backed companies in India have outperformed peers in both revenue and earnings growth. This outperformance is directly linked to the operational improvements introduced by active PE ownership.
The bigger picture
Revenue growth is the largest driver of PE value creation, while margin expansion plays a smaller role. PE firms are mainly geared towards acquiring successful businesses and scaling them rather than acquiring underperforming businesses and turning them around. This is the reason why a higher contribution of margin expansion in value creation is not commonly seen.
Given that multiples expansion is subject to market vagaries, revenue growth has become an even more critical driver of success. Companies with a more active buy-and-build strategy drive higher value creation through revenue growth. Having said that, successful integration and execution quality are critical. Poorly executed bolt-ons can destroy value regardless of strategy.
In a recent sale by a PE to a strategic (buyout deal), the PE investor stood to make impressive returns, which based on anecdotal evidence seems to have been delivered through a combination of organic and inorganic growth levers. Organic growth is being achieved inter alia by way of leadership changes, bringing in industry specialists and seasoned operating partners, margin expansion, R&D, pipeline focus and international expansion. Inorganic growth was delivered by a string of bolt-on acquisitions that boosted business in some key market segments and white-spaces.
Looking ahead
Global uncertainties and corrections in public markets will continue to test exit strategies in late 2025. India’s robust consumption and growth outlook can be expected to provide some cushion – the fundamentals remain strong.
PEs must shape businesses that are resilient, scalable and innovative from the start. Data-driven decision-making, AI-led efficiencies, ESG alignment and global expansion strategies are no longer optional. They are core levers. Leadership recalibration and sharper board oversight can ensure companies align with industry trends.
The mantra for the future is simple: Create value beyond financials. PE firms can shape companies that command premium outcomes by embedding agility, resilience and innovation from day one.
Exit Strategy 2.0 is about building enduring enterprises. Enterprises that stand the test of cycles. Enterprises that define the future of value creation in India and beyond.
