Industrial & Logistics Sector Captures 67% of PE Investments in H1 FY25 – ANAROCK Capital

Mumbai, 15 October 2024 – Private equity investments witnessed a 4% decline in the first half of FY25, primarily due to reduced investments in the offices sector. The total number of deals also declined from 24 (1H FY24) to 17 (1H FY25).

Shobhit Agarwal, MD & CEO – ANAROCK Capital, says, “Private equity investments in offices are primarily driven by foreign investors, which have tapered down due to global factors such as geopolitical tensions and elevated interest rates. However, the aggregate numbers and the dominance of foreign investors in Indian real estate remained largely stable due to the ADIA/KKR investment in the Reliance Retail warehousing assets.”

	Amount (US$ Bn)
1H FY21	1.2
1H FY22	2
1H FY23	2.8
1H FY24	2.4
1H FY25	2.3

Average Ticket Size

The average deal size has risen by 23% year-on-year, primarily driven by the Reliance-ADIA/KKR warehousing deal which accounts for 67% of the total investments made in the first half of FY25. Additionally, the number of deals has decreased by 29%, contributing to the increase in the average ticket size.

	Amount (US$ Mn)
1H FY24	104
1H FY25	128

Top 10 PE Deals

Share of top PE deal – approx. 67% of total deals in 1H FY25:

• Buyers – Abu Dhabi Investment Authority (ADIA) & KKR
• Seller – Reliance Logistics & Warehouse Holdings
• Assets – Warehouses at multiple locations
• Deal Size – US$ 1.54 Bn

Asset Class	Capital Provider	Recipient	City	Deal Type	Deal Value(US$ Mn)
Logistics & Warehousing	ADIA & KKR	Reliance Logistics & Warehouse Holdings	Pan India	Mix	1,542
Commercial	GIC & Xander	SPRE Fund II	Hyderabad	Equity	258
Commercial	Capitaland India Trust	Aurum Ventures	MMR	Equity	85
Commercial	Capitaland India Trust	Phoenix Group	Hyderabad	Equity	26
Residential	HDFC Capital	Provident Housing / Puravankara	Bengaluru	Debt	138
Residential	PAG	Shapoorji Pallonji	MMR	Debt	61
Residential	Edelweiss	Century Group	Bengaluru	Debt	54
Residential	S C Lowy	Pharande Township	Pune	Debt	33
Residential	ASK Property Fund	Kalpataru Group	MMR	Debt	23
Residential	Nisus Finance	Dharmadev Group	Surat	Debt	19

• Residential real estate accounted for 15% of transactions among the top 10 private equity deals. In comparison, the same period last year saw only about 4% of debt transactions in residential real estate within the top 10 deals.
• The Reliance-ADIA/KKR deal is a hybrid transaction, comprising 55% through senior debt, 41% via subordinated NCDs/quasi-equity, and the remainder through equity infusion.

Share of Top 10 PE Deals (YoY)

The top 10 PE deals accounted for 97% of the total value of PE investments in 1H FY25 as compared to 93% in 1H FY24.

Movement of Capital Flow

In H1 of FY25, the Reliance-ADIA/KKR multi-city deal took the lead. Hyderabad topped the transaction league tables for city-specific deals, attracting investments of USD 284 million during this period. While Hyderabad’s share of investments increased, Mumbai’s share fell to 9%, down from 23% in the same period last year.

	1H FY24	1H FY25
NCR	3%	0.1%
MMR	23%	9%
Pune	2%	1.5%
Bengaluru	0%	9%
Chennai	2%	0.5%
Hyderabad	4%	12%
Kolkata	0%	0%
Portfolio Deals (Multiple Cities)	60%	67%
Other Cities	6%	0.9%

Equity vs Debt Funding

During H1 FY25, pure debt and equity transactions were less prominent and overshadowed by the Reliance – ADIA / KKR deal. As reported, this transaction includes a mix of senior debt, quasi-equity or subordinate debt, and equity infusion.

Year	Debt	Equity	Mix
1H FY24	10%	87%	3%
1H FY25	17%	17%	66%

Domestic vs Foreign Funding

Domestic and foreign investors upheld the same funding proportions as in the first half of the previous year, reflecting the continued dominance of foreign investors in Indian real estate investments.

Year	Domestics	Foreign
1H FY24	14%	86%
1H FY25	13%	87%

Asset Class-wise Funding

H1 FY25 saw the industrial and logistics sector capture 67% of the total investments, significantly surpassing both the office and residential sectors (which attracted 17% each). While private equity investments in the office sector declined by 79%, the industrial and logistics sector saw a substantial 378% increase in investments compared to the same period in the previous financial year.

	1H 2024	1H 2025
Office	73%	17%
Residential	8%	17%
Industrial & Logistics	16%	67%
Others	3%	–