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Alternative Market Briefing

Investors bullish on private equity, despite growing concern over valuations

Friday, September 20, 2019

Laxman Pai, Opalesque Asia:

Despite growing concern overvaluations, investors remain confident in the private equity and they plan to increase their commitments asset class in the year ahead.

The outlook for private equity for the coming year remains positive, making it one of the strongest asset classes, said Preqin Investor Update: Alternative Assets H2 2019.

The vast majority of private equity investors surveyed feel that the performance of the asset class has met or exceeded their expectations in the past year, and 78% believe it will perform as well or better in the next 12 months.

Four out of five investors think asset valuations present a key challenge in the year ahead, up from 72% at the beginning of the year.

Despite this, a notable 40% of investors are planning to commit more capital to the asset class in the next 12 months than they did in the previous 12 months.

The largest proportion (68%) will target small to mid-market buyout funds, while growth and secondaries funds are increasingly gaining attraction. Similarly, the largest proportion of investors will target the US among developed markets, while China is the preferred region among emerging markets.

Christopher Beales, Private Equity Analyst said: "Private equity tops the table for investor satisfaction across alternative assets. Investors feel that private equity has performed well, and we can see that from the high distributions of recent years - private equity funds have c......................

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