Preqin: Asia’s private capital AUM to reach RM24.78 trillion by 2025


KUALA LUMPUR: Asia’s private capital assets under management (AUM) is set to reach US$6 trillion or RM24.78 trillion (US$1=RM4.13) by 2025, according to the Alternative Assets in Asia-Pacific report published by Preqin.

According to forecasts, Asia-focused private capital AUM will grow at a world beating compound annual growth rate of 28.3 per cent from 2020 until 2025.

The Preqin study found that Asia Pacific-based private capital (excluding hedge funds) dry powder held by fund managers stood at a record US$446 billion as of April 2021, up from US$416 billion in December 2020.

Seventy-seven of this capital ready for deployment is held by private equity and venture capital fund managers in the region, followed by real estate at 10 per cent.

“Private capital is playing an increasing role in asset allocations across Asia Pacific, as demand to access this fast growing and diverse region remains robust.

“Asia Pacific-focused private capital AUM has already expanded almost six-fold over the past decade, reaching US$1.71 trillion in September 2020, with US$133 billion raised during 2020 alone.

“Along with US$156 billion in Asia-Pacific hedge funds as of fourth quarter 2020, the region is fast approaching the US$2 trillion,” said the report.

Preqin said hedge funds have faced more difficulties as new fund launches in the region declined 20 per cent in 2020 to 117 on the back of the COVID-19 pandemic.

Overall, AUM growth is being seen across Asia-Pacific, with China’s private equity and venture capital maturing fast with an AUM of more than US$1.04 trillion.

“This equates to more than 13 per cent of the global total and 61 per cent of capital targeting the Asia Pacific region,” it said.

Meanwhile, Asean saw the completion of 400 venture transactions valued at a combined US$8.2 billion last year.

In Australia, a record US$14 billion total dry powder held by focused private equity and venture capital firms at the end of first half of 2020. – Bernama

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