Private Equity - Pakistan | Statista Market Forecast

The deal value in the Private Equity market is projected to reach US$115.60m in 2024.
It is expected to show an annual growth rate (CAGR 2024-2025) of 27.80% resulting in a projected total amount of US$147.80m by 2025.
The average size per deal in the Private Equity market amounts to US$115.60m in 2024.
From a global comparison perspective it is shown that the highest deal value is reached United States (US$594.00bn in 2024).
In the Private Equity market, the number of deals is expected to amount to 1.45 by 2025.

Definition:

Private equity involves partnerships that buy, manage, and eventually sell companies. These firms manage funds for institutional and accredited investors, who commit significant capital for extended periods. Private equity funds can acquire entire private or public companies or participate in buyouts with other investors, but they typically avoid holding stakes in publicly traded companies. The Private Equity market encompasses a broad range of deal types that involve acquiring equity ownership in private companies. This market typically includes leveraged buyouts (LBOs), growth capital, Carve-outs, and other forms of equity investments that target mature businesses with the potential for operational improvements and value creation. The market presented here does not include Venture Capital investments. While both Private Equity and Venture Capital involve equity stakes in companies, Venture Capital specifically focuses on high-growth potential startups, while private equity firms invest in established companies with the aim of increasing the value of these companies before selling their investment after several years.

Additional information:

The market contains the following KPIs: the deal value, the number of deals, the average deal size as well as the assets under management (AUM). Key players in this market are companies such as Blackstone, The Carlyle Group, KKR, Goldman Sachs, General Atlantic, and Warburg Pincus.

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Leveraged Buyouts (LBOs)
Growth Capital
Carve-Outs
Distressed Buyouts
Secondary Buyouts

Venture Capital
Venture Debt
Traditional bank loans
Digital capital raising

The Private Equity market in Pakistan is witnessing minimal decline, influenced by factors such as economic uncertainties, regulatory challenges, and limited access to funding. However, potential for growth remains as investors seek opportunities in emerging sectors and startups.

Customer preferences: Investors in Pakistan's Private Equity market are increasingly focusing on technology-driven startups, as consumers exhibit a growing preference for digital solutions in various sectors such as e-commerce, fintech, and health tech. The rise in smartphone usage among the youth demographic drives demand for innovative products and services. Furthermore, there is a noticeable shift towards sustainable and eco-friendly business practices, prompting investors to consider ventures that align with evolving consumer values around sustainability and corporate social responsibility.

Trends in the market: In Pakistan, the Private Equity market is experiencing a surge in interest towards technology-focused ventures, particularly in sectors such as e-commerce, fintech, and health tech, driven by an increasing reliance on digital solutions among consumers. The proliferation of smartphones, especially among the youth, is fueling demand for innovative and accessible products. Additionally, investors are prioritizing sustainability, leading to a preference for startups that embrace eco-friendly practices. This trend of aligning investments with consumers' values on social responsibility could reshape investment strategies and enhance stakeholder engagement across various industries.

Local special circumstances: In Pakistan, the Private Equity market is uniquely influenced by its diverse cultural landscape and a youthful population eager for technological advancement. The country's geographical challenges, such as varying access to urban infrastructure, create opportunities for innovative solutions in logistics and connectivity. Additionally, regulatory frameworks are evolving to support foreign investment and entrepreneurship, fostering a more conducive environment for venture capital. These factors collectively fuel growth in sectors like fintech and e-commerce, reflecting local consumer needs and aspirations.

Underlying macroeconomic factors: The Private Equity market in Pakistan is significantly shaped by overarching macroeconomic factors, particularly central bank policies and interest rate fluctuations. A lower interest rate environment, implemented by the State Bank of Pakistan to stimulate economic growth, encourages increased borrowing for investment, enhancing capital availability for private equity firms. Conversely, rising rates could constrain liquidity and elevate the cost of capital, potentially slowing investment momentum. Global economic trends, such as shifts in foreign direct investment and commodity prices, further impact local market performance, as they dictate investor sentiment and risk appetite, ultimately influencing deal-making activity within the private equity sector.

Data coverage:

The figures are based on deal value, number of deals, the average size of each deal, and assets under management within the Private Equity market.

Modeling approach / Market size:

Market sizes are determined through a combined top-down and bottom-up approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use annual financial reports of key players, industry reports, third-party reports, and publicly available databases. In addition, we use relevant key market indicators and data from country-specific associations, such as: GDP, total investment (% of GDP), household wealth (per Adult), high income (% of population), and number of high-net-worth individuals (HNWI). This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. In this market, we use the HOLT-damped Trend method to forecast future development. The main drivers are total investment (% of GDP), household wealth (per Adult), number of high-income persons, and number of high-net-worth individuals (HNWI).

Additional notes:

The market is updated twice a year in case market dynamics change.

This report presents a comprehensive analysis and additional information on the Financial market, in a PDF format.

In the last decades, private equity has emerged as a dominant force in global finance, reshaping industries and driving economic growth worldwide. After the peak experienced in 2021, however, private equity activity slowed down in 2022 and 2023, due to multiple factors such as inflationary headwinds, rising interest rates, geopolitical unrest and general uncertainty. With an estimated value of nearly four trillion dollars, private equity dry capital - a term commonly used in the private equity world to refer to committed, but unallocated capital - reached unprecedented heights in 2023. A high level of this capital means that private equity firms have unspent cash reserves. Among the most influential private equity firms worldwide, the Blackstone Group is the largest in terms of funds raised.