At a time when benchmark Sensex has plunged 20 per cent and foreign institutional investors have sold $4 billion worth of shares in the first nine months of 2011, private equity investments from the likes of JP Morgan, Goldman Sachs and Axis Bank, among others, in Indian companies in 2011 so far underscore the fact private equity deals continue to gain momentum despite uncertain equity market sentiment.

In the first nine months (Jan-Sep) of 2011, private equity investors struck 306 deals and invested $8.97 billion in various Indian companies, a 39 per cent rise compared with $6.43 billion investments in 247 deals in the corresponding period of 2010, data released by Four-S Services showed.

However, global economic uncertainty lowered investment sentiments in the third quarter (July-September) as private equity investments moderated to $2.69 billion in 102 deals, down 18 per cent from deal value of $3.29 billion in 118 deals during the second quarter of 2011, the data showed.

During the third quarter, deals under $50 million accounted for 72 per cent of the total deal volume, with $50 million-plus deals accounting for another 13 per cent.

“India’s macro-economic picture looks very positive despite several challenges. Private equity investors believe India is a good long-term bet, which will be driven by robust consumption pattern. In listed companies, valuations are quite attractive given the sharp fall in the current year, which will give them an edge to invest in fundamentally good companies,” said KK Iyer, MD with IEP Advisors.

JP Morgan’s $400 million investment in Skil Infrastructure, owned by Nikhil Gandhi, was the largest deal during the third quarter. SKIL Infrastructure controls ship-builder Pipavav Defense and Offshore Engineering, and also holds 21 per cent stake in Everonn Education.

Renewable energy start-up ReNew Wind Power, founded by prominent deal-maker and former Suzlon Energy COO Sumant Sinha, received $200 million from Goldman Sachs. In one of the biggest deals in the global mobile internet space, InMobi, which provides one of the world's largest mobile ad networks, received a $200 million investment from Japan’s SoftBank, the data showed.

The beleaguered microfinance sector also received a shot in the arm when a group of investors comprising IFC, Matrix Partners, Axis Bank, Lok Capital and others invested $177.8 million in Bhartiya Samruddhi Finance the data said.