Asia's Private Markets: Growth, Innovation, Value

Executive Summary

Asia’s private market offers distinct opportunities for investors seeking exposure to:

• A growing and dynamic consumer base: Asia’s rapidly expanding and diverse middle class¹ fuels demand across sectors and provides resilience against global economic uncertainties.
• An innovative workforce: The region’s tech-savvy, educated workforce is driving opportunities by transforming traditional industries, enabling founder transitions, and expanding sustainability-focused sectors.
• Value-driven private markets dynamics: Asia’s maturing private markets ecosystem delivers compelling valuations and deal structures, underpinned by proven performance.

Asia drove nearly 60% of global GDP growth in 2024, led by emerging economies such as China, India, and Vietnam, and supported by established industrial powerhouses like Japan and South Korea². Fueled by an expanding middle and upper class¹. and thriving innovation hubs, these markets, though frequently undervalued, are increasingly positioned for outperformance.

Much of this potential is being created in the private markets: Just 14% of Asian companies with over $100M in revenue are publicly listed, making private markets a critical pathway for accessing the region’s growth³.

Here are three reasons Asia’s private markets stand out

1. A growing and dynamic consumer base

Asia is home to 60% of the global population and is projected to account for over half of the world’s middle and upper class¹ by 2030³.  This expanding demographic, representing  a resilient consumer base, helps businesses navigate tariffs and geopolitical uncertainties with greater stability.

Asia’s customer base varies widely across the region and is shaped by distinct demographic and cultural dynamics:

• Youthful and tech savvy: In regions such as India and Vietnam, youthful, tech-savvy consumers are fueling growth in digital services, sustainable products, and everyday essentials.
• Aging and health-focused: In Japan and South Korea, there’s been an increased demand for healthcare services, medical technology, and senior care facilities, providing stable growth opportunities.
• Urban and mobile: In China, the urban consumer base is sparking higher consumption of lifestyle goods and services. Businesses such as car rentals are thriving.

2. An innovative workforce

There’s another benefit to the region’s growing middle class¹: An educated, tech-focused workforce which capitalizes on the region’s evolving landscape to drive innovation.

Examples include:

• Modernizing manufacturing: Traditional sectors like steel and textiles are being retooled for high-tech, sustainable industries. A Hong Kong firm, for instance, converted a legacy factory to produce eco-friendly cosmetic packaging with global applications.
• Founder transitions: Japan’s aging workforce is driving founder exits and carveouts. This is creating opportunities to optimize value in companies such as pharmaceutical chains.
• Sustainability-focused sectors: Government policy and consumer demand are fueling growth in renewables and green infrastructure. Solar projects in India, for example, offer strong returns for impact-driven investors.

3. Value-driven private market dynamics

Asia’s public markets have historically been more volatile than its private markets—with foreign investors influencing prices. For the last 15 years, the region’s private markets have outperformed APAC public equities and have even bested global listed equities the vast majority of the time period.

And the region’s private markets are evolving—offering the benefits of a mature asset class combined with the momentum of an emerging landscape.

Asia Private Equity Rolling Time-Weighted Returns

The private market’s maturity can be seen in diversified exit strategies, including IPOs, sponsor-to-sponsor transactions, and GP-led secondaries. In addition, more deals are now managed by active GPs working to improve portfolio company performance and operational efficiency.

Yet entry multiples remain significantly lower than those in public markets and U.S. private markets. In addition, discounted secondaries—often priced 20–30% below value⁴—have created opportunities for sophisticated investors.

The Hamilton Lane advantage

Investing in Asia’s private markets can be complex for firms without local expertise and tailored, nuanced strategies for each market. Hamilton Lane has an established presence across Asia, including:

• Regional offices. Hamilton Lane has been in Asia since 2008. Our six offices⁵ and team of approximately 60⁵ investment and client solutions professionals fosters local networks, enabling access to proprietary deal flow.
• Access to top GPs. Hamilton Lane tracks over 400 general partners (GPs) in the Asia Pacific region⁶. These deep GP relationships may unlock exclusive investment opportunities that can lead to high-quality, proprietary deal flow.
• Strong actionable direct and secondary deal flow: In 2024 our transaction deal flow exceeded $14.5B across sponsors, strategies, geographies and industries.

Partnering with managers who possess deep regional expertise—such as those at Hamilton Lane—is key to tapping into Asia’s private market potential.