New Delhi: Nearly half of the companies surveyed by industry chamber Ficci said they would consider to make fresh investments in Europe as they expect markets there to stabilise and recover in the next 6 to 12 months.
The survey said the Indian investments in the EU during the current year may not reach the 2008 mark of €2.4 billion due to global economic slowdown.
The survey covered 30 companies including Wockhardt, Suzlon Energy, HCL Technologies, Apollo Tyres and ONGC, out of which 12 firms were positive about the European markets and said would consider making fresh investments there.
A majority of the firms said the planned deal size is less than $100 million on an average as they are not willing to go for large-sized buys because of the current economic environment, the study said.
It said the rush to acquire companies in Europe reached its peak in 2007 when the total investments reached a high of €9.5 billion, while the investment dropped to €2.4 billion in 2008.
European countries emerged as a favoured destination for Indian companies, who were seeking growth in size and scale of operations, increased market access, better technologies and research and development facilities.
The Ficci survey said the most preferred sectors for investment in Europe are pharmaceuticals, biotechnology, energy, manufacturing, auto and auto components and IT and ITes.
Further, it said, majority of the surveyed companies have not faced any problems in raising funds for acquisitions as the liquidity crunch has somewhat eased now.
About 90% of the respondents said the government’s policies towards outward investments have been favourable. This has certainly been an impetus for the Indian companies to look beyond their national boundaries and set their sight at EU and other destinations, it said.