Secondaries Redefine Exits in India’s Private Markets

In the first half of 2025, the global secondaries market reached a historic milestone. Transaction volume surged to $103 billion, a 51% increase over H1 2024, marking the most active 6-month period ever recorded (Jefferies). But behind this global boom, a quieter revolution is brewing in India, one that may redefine the country’s private capital landscape. Secondaries, once viewed as a niche liquidity tool, are now emerging as a structural pillar of India’s private markets, reshaping how investors think about exits, distributions, and portfolio construction.

Secondaries Go Mainstream

What was once a discreet tool for distressed LPs is now one of private markets’ most important structural enablers. In H1 2025, dedicated capital for secondaries hit an all-time high of $302 billion, up from $288 billion in December 2024. With evergreen retail vehicles gaining traction and record fundraising activity from both institutional and crossover funds, secondaries are no longer a niche play. They’re now an asset class of their own.

In India, this trend is taking hold at an accelerating pace. According to the Global Private Capital Association, secondaries exits in the first half of 2024 accounted for $2.2 billion across 23 deals, making them the second-largest exit route after IPOs ($8.1 billion), and well ahead of strategic sales ($1.1 billion). This underscores that secondaries are emerging as a core asset class in India’s private markets, giving GPs and LPs a credible alternative to conventional IPO or M&A exits.

The Catalyst: A Dry Spell in Distributions

One of the clearest reasons behind secondaries’ rise, globally and in India, is the liquidity crunch. Traditional exit paths like IPOs and M&A remain uneven. According to Bain, distributions as a percentage of net asset value (NAV) dropped to 11% globally in 2024, the lowest in over a decade.

India has mirrored this drought. A market update by Houlihan Lokey highlighted that Category II AIFs launched between 2015–2020 have delivered average DPI of just 0.5x–0.8x. Secondaries are emerging as a viable bridge between paper returns and actual liquidity.

LP and GP-Led Activity Hit New Highs

In H1 2025, LP-led secondaries globally hit $56 billion, while GP-led jumped to $47 billion, the highest ever. Notably, GP-leds have seen a 68% year-over-year rise, with 87% of that activity coming from continuation vehicles.

India is now catching up to this playbook. Several leading fund managers have begun structuring India-domiciled continuation vehicles, enabling them to extend ownership of high-performing assets while giving LPs the option of liquidity. New India-focused fund strategies being raised in 2025 are explicitly incorporating secondaries as part of their capital planning, reflecting a strategic shift. Liquidity management is no longer reactive, but baked into fund design.

Why the Flywheel Is Turning in India

The surge in secondaries in India is being driven by a mix of push and pull factors:

• Push factors: low liquidity, delayed exits, and vintage overhangs from 2015–2020 funds have created urgency. Many GPs have quality assets but lack traditional exit windows.
• Pull factors: better pricing, more sophisticated structures, and broader participation are making secondaries attractive for both buyers and sellers.

This dual dynamic is creating a flywheel effect. As more secondaries are executed, confidence grows, valuations stabilize, and participation widens. In turn, this draws more capital into the ecosystem, fueling further activity.

India’s Distinct Playbook

India’s secondaries wave is not a carbon copy of the West, it reflects local market dynamics:

• Emerging exit path: Unlike in developed markets where secondaries matured over decades, India’s surge has been rapid. In 2024 alone, secondaries leapfrogged strategic sales to become the second-largest exit route.
• Domestic participation: Domestic LPs, family offices, and wealth managers are beginning to view secondaries not as opportunistic but as strategic allocations. This mindset shift is critical in sustaining volume.
• Cross-strategy adoption: Beyond buyouts, India’s venture ecosystem is primed for secondary solutions. With ~1.6 lakh startups and limited IPO/M&A capacity, structured secondaries provide a necessary liquidity valve for VCs and founders.
• Private credit linkages: As India’s private credit market grows, secondary activity is starting to emerge in debt portfolios too, creating new hybrid structures for liquidity.

In effect, India is writing its own secondaries playbook, one that spans PE, VC, and private debt simultaneously.

What Investors Should Watch in H2 2025

As India steps into the global secondaries spotlight, allocators should track several developments in the coming quarters:

• Rise of dedicated secondary AIFs: Expect to see Category II and III AIFs launched specifically for secondary strategies, giving LPs new vehicles to access this market directly.
• Domestic fund-of-funds participation: Large domestic allocators, including quasi-sovereign vehicles and pension-linked funds, are beginning to engage in structured secondary purchases.
• Pricing differentiation: Premiums are emerging for newer vintages and high-quality growth assets, while older or underperforming portfolios may still trade at discounts.
• Sector diversification: Venture and private credit secondaries are gaining traction, expanding the market beyond buyouts.
• Scaling of continuation vehicles: India-based GPs are expected to announce larger CVs, moving beyond single assets into portfolio-level deals.

For LPs, this creates both opportunity (to access India’s best companies at attractive valuations) and complexity (to evaluate alignment, pricing, and governance in GP-led deals). Given these nuances, LPs should rely on experienced fund managers to navigate deal structures, assess fair value, and ensure alignment with long-term portfolio goals.

India as the Convergence Point

Globally, secondaries are enabling the next phase of private capital maturity. In India, they are becoming the foundation of it. The ecosystem’s growth engine (startups, PE-VC, domestic LPs) is converging with the liquidity engine (secondaries), together building a more agile and institutionally mature market.

The significance is clear: secondaries are no longer just a pressure valve for liquidity, they are becoming a permanent structural feature of India’s private markets. As more deals close, fund structures evolve, and domestic participation deepens, India is poised to emerge as one of the most dynamic secondaries markets in the world.

For global LPs and GPs, the message is simple: India’s private markets are no longer defined only by high-growth entries, but increasingly by sophisticated, reliable exits.