TMT industry to show vitality once again

A woman shows banknotes and coins included in the 2019 edition of the fifth series of the renminbi. [Photo/Xinhua]

Investments by private equity and venture capital companies in China's telecommunications, media and technology industry are expected to pick up this year, fueled by a slew of stimulus measures to stabilize economic growth and the government's strong support for technological innovation, according to a new report released by global consultancy PwC.

The new artificial intelligence wave triggered by the launch of AI chatbot ChatGPT is expected to bring about new investment opportunities for TMT sub-sectors, such as semiconductors, games, software and internet, said Aileen Mo, PwC Chinese mainland assurance partner.

The report said a total of 1,770 PE/VC deals in the TMT industry were recorded in the second half of 2022, up 7 percent compared with the first half of last year. However, deals with disclosed investment value amounted to $8.39 billion in total, a decline of 61 percent from the first half of 2022.

Among the sub-sectors of the TMT industry, the technology industry drew the most attention from investors and retained the top spot for investment in the second half of last year, with the volume and value in the technology sub-sector accounting for 86 percent and 84 percent of the total investments, respectively, in the TMT sector.

There were 1,521 investment deals made in the technology sub-sector in the second half, with total investment value reaching $7.03 billion. Notably, the IT services, semiconductor and optoelectronic sector attracted an influx of investments, PwC said.

With the authorities' vigorous support for technological innovation, the country's economy witnessing robust recovery, as well as the adoption of registration-based IPO system across the board, PE and VC investments in China's TMT industry will show vitality again, Susan Deng, PwC Chinese mainland assurance partner.