《中国创投暨私募股权投资市场2011年第三季度数据回顾》--英文版_57页_1mb

China VC/PE Market Review Q1-Q3 2011

Overview

The China VC/PE market experienced significant activity in the first three quarters of 2011, marked by a fundraising boom, increased investment, and dynamic exit trends. This period saw a notable shift in market dynamics, with RMB funds becoming more prominent and foreign institutions also showing growing interest in setting up RMB-denominated funds. The market was influenced by both domestic and international factors, including the growth of domestic LPs, preferential policies, and the impact of the global financial climate.

Key Market Trends

Fundraising

• A total of 136 VC funds were raised in Q1-Q3 2011, with 63 raised in Q3 alone, marking an all-time high.
• The total capital raised reached US$11.61B, surpassing the full year of 2010.
• RMB funds dominated fundraising, raising US$12.29B or US$129.31M on average, while foreign currency funds also saw a notable increase, raising US$11.80B in total.
• 39 RMB funds had sizes below US$100M, and the average capital per fund dropped in Q3 due to the historical performance of new institutions.

Investments

• 925 investment deals were made in Q1-Q3 2011, surpassing the number of deals in 2010.
• The total investment amount reached US$9.45B, significantly higher than the full year 2010 total of US$5.39B.
• RMB funds led in both the number and value of investments, although the amount per fund decreased.
• Internet and Machinery Manufacturing emerged as the most active sectors in terms of investment deals and amount.
• Growth capital continued to dominate investment strategies, while real estate and energy sectors attracted significant investment.

M&A Activity

• 763 M&A deals were recorded in Q1-Q3 2011, with 681 being domestic and 82 cross-border.
• The total M&A value reached US$38.12B, with real estate and energy sectors securing the top two positions in terms of the number of deals.
• Cross-border M&A reached a new high, driven by global market conditions and strategic acquisitions.

IPO Market

• 467 Chinese enterprises were listed in Q1-Q3 2011, with 61% of these being domestic.
• ChiNext accounted for nearly half of the domestic IPOs, highlighting its importance in the market.
• The machinery manufacturing sector was the most active in domestic IPOs, followed by chemical raw materials and processing, clean-tech, and automobiles.
• Overseas IPOs saw a sharp decline due to the Europe & U.S. debt crisis, China concept stock turmoil, and VIE issues.
• Domestic IPOs had an average ROI of 7.53X, while overseas IPOs averaged 5.87X, with NYSE and NASDAQ showing the highest returns.

Market Analysis and Z-Insights

Fundraising Trends

• RMB funds were the mainstay of fundraising, reflecting the growing confidence of domestic LPs and preferential policies.
• Foreign institutions also showed increasing enthusiasm, setting up RMB funds to tap into local markets, indicating a strategic shift in investment focus.

Investment Strategies

• Growth capital remained the dominant investment strategy, followed by real estate, energy, and private equity.
• PE funds were more active in listed companies with low valuations, with a rise in private placement and PIPE deals.

Exit Opportunities

• IPOs were the primary exit route for VC/PE-backed companies, with 38.12B USD raised through IPOs.
• Domestic exits were more common, but overseas exits were also notable, particularly in NYSE and NASDAQ.

Industry Focus

• Internet, clean-tech, and machinery manufacturing were key sectors for both VC and PE investments.
• Real estate and energy sectors were the most active in M&A deals, showing strong interest in consolidation and expansion.

Summary of Key Figures

Conclusion

The China VC/PE market in Q1-Q3 2011 was characterized by a fundraising boom, increased investment, and dynamic exit opportunities, particularly through IPOs. The market showed a shift towards RMB funds, with domestic LPs playing a key role in driving growth. Internet and clean-tech were the most attractive sectors for investment, while real estate and energy dominated M&A activity. The IPO market was heavily influenced by global economic conditions, with ChiNext becoming a major platform for domestic listings. Despite challenges, the VC/PE-backed enterprises continued to show strong performance, with growth capital and private equity leading the investment strategies.