Rate Cuts Drive Recovery as Markets Fragment | PitchBook APAC Private Capital Outlook

What's New

PitchBook's 2026 APAC Private Capital Outlook forecasts a monetary easing cycle that will drive deal momentum, with a moderate 10-20% YoY increase in exit value achievable. Through Q3 2025, PE exit value reached $106 billion—already surpassing full-year 2024—while VC exit value hit $90 billion, up sharply from $52.7 billion over the same period last year.

Why It Matters

The "one Asia" strategy is fading as the region fragments into distinct ecosystems. India and Japan are becoming primary exit engines supported by deep institutional investor bases, while China evolves into a self-contained system dominated by RMB-based funds and policy-backed investment. US LP commitments to Greater China PE and VC funds have collapsed from over 100 in 2016 to just one in 2025.

Big Picture Drivers

• Infrastructure opportunity: The Asian Development Bank estimates Asia requires $1.7 trillion annually through 2030 for infrastructure—only a fraction currently addressable by public and private funding

• China's inward turn: Heavy reliance on state-backed capital is shifting focus from IRR-driven investing to strategic deployment aligned with national objectives; pricing is increasingly policy-driven rather than market-based

• Dual liquidity structure: Capital is raised and deployed domestically in China but monetized offshore—share of Chinese listings on domestic exchanges fell from 50% in 2019 to just 4% in 2025

• GP-led secondaries expansion: Global secondaries players (Coller Capital, HarbourVest) have established dedicated Asian teams; notable transactions include ChrysCapital's $700M India continuation fund and Trustar's $1B China continuation fund

• Trade détente tailwinds: Late-2025 diplomatic breakthroughs (Trump-Xi meeting, US-Korea investment accord, ASEAN-China trade agreement) eased policy uncertainty

By The Numbers

• 10-20%: Projected YoY increase in APAC exit value for 2026

• $106B: APAC PE exit value through Q3 2025, already surpassing full-year 2024

• 1: US LP commitments to Greater China funds in 2025, down from 100+ in 2016

• $48B: Global GP-led secondary volume in H1 2025, a trend gaining traction in Asia

• 4.1%: IMF projected aggregate growth for Asia in 2026, down from 4.5% in 2025

Key Trends to Watch

• India and Japan dominance: These markets will remain primary exit engines—India's active domestic IPO market and Japan's corporate governance reforms continue facilitating sizable transactions

• Southeast Asia floor: After two years of contraction, SE Asia's venture market is expected to find its bottom in 2026; GPs are tightening discipline around valuation and seeking ties with regional family offices

• Hong Kong resurgence: Hong Kong's IPO market is emerging as a "politically neutral and capital-rich venue" for both growth- and buyout-backed exits as listing approvals grow

• Australia policy tailwinds: Regulatory reforms have shortened IPO approval timelines; Virgin Australia's successful listing demonstrated the market is open for high-quality issuers

The Wrap

2026 will be a year of "measured rebuilding" for APAC—gradual normalization rather than broad acceleration. Local capital formation is increasingly critical as global LPs retrench, and alternative liquidity mechanisms are becoming integral to portfolio management as traditional IPO markets remain selective.

Read Full Report PitchBook 2026 APAC Private Capital Outlook