# Table 1: Returns, duration, home runs, investments by sector, 1961-2023

Table includes two metrics to assess investment performance: the Total Value to Paid-In (TVPI) ratio and its annualized counterpart (TVPI _A_ ). TVPI measures the overall return on investment, calculated as the sum of cumulative distributions and the residual value (the current value of the remaining investment) divided by the cumulative contributions (the total capital invested). A TVPI greater than 1 indicates that the investment has grown in nominal value, while a value less than 1 implies a nominal loss. To provide a time-adjusted perspective, the annualized TVPI (TVPI _A_ ) adjusts the TVPI to reflect an average annualized growth rate over the life of the investment. It is computed by taking the TVPI ratio to the power of years1<sup>, where ”years” is</sup> the duration of the investment in years, and then subtracting 1. This metric enables comparisons across investments of different durations by standardizing returns on an annual basis. Sector names are according to IFC sector classification. Home runs are investments with an annualized TVPI greater than or equal to 50%.

|**Sector**<br>**TVPI (annualized)**|**TVPI**<br>**A**|**verage years**|**Home-runs**|**Projects**|
|---|---|---|---|---|
|Construction and Real Estate<br>-3.13%|0.81|6.69|0|29|
|Professional, Scientifc and Technical Services<br>-0.69%|0.96|6.64|0|65|
|Textiles, Apparel & Leather<br>-0.33%|0.96|12.52|0|71|
|Accommodation & Tourism Services<br>-0.06%|0.99|11.10|0|63|
|Education Services<br>0.39%|1.02|6.00|2|30|
|Pulp & Paper<br>0.58%|1.07|11.36|1|43|
|Primary Metals<br>2.74%|1.36|11.32|1|39|
|Transportation and Warehousing<br>2.95%|1.26|8.04|1|83|
|Collective Investment Vehicles<br>3.51%|1.34|8.50|8|694|
|Electric Power<br>5.05%|1.53|8.61|1|89|
|Chemicals<br>5.12%|1.62|9.70|3|107|
|Utilities<br>5.54%|1.48|7.28|0|31|
|Health Care<br>5.84%|1.51|7.25|0|60|
|Nonmetallic Mineral Product Manufacturing<br>5.86%|1.86|10.90|2|89|
|Plastics & Rubber<br>6.97%|1.90|9.52|0|17|
|Industrial & Consumer Products<br>7.20%|1.77|8.26|1|111|
|Finance & Insurance<br>7.20%|1.85|8.87|15|654|
|Agriculture and Forestry<br>7.75%|1.78|7.75|5|84|
|Food & Beverages<br>8.60%|1.97|8.22|2|102|
|Oil, Gas and Mining<br>13.39%|2.80|8.18|6|162|
|Wholesale and Retail Trade<br>16.56%|2.11|4.89|1|32|
|Information<br>21.29%|3.12|5.90|13|72|

The results suggest that private equity returns are superior in sectors characterized by high growth potential or resource availability, partially confirming the findings by Bai et al. (2012).<sup>14</sup> Sectors like mining and information technology benefit from structural growth drivers in EMDEs, such as urbanization, digitalization, and resource exploitation. These factors create opportunities for private equity investors to generate outsized returns by capitalizing on inefficiencies or unmet 14The authors use data on 1,537 individual firms from selected emerging markets, consisting of monthly adjusted prices of ordinary shares for the period from August 1984 to July 2004, which includes the 1997 Asian financial crisis. They find superior returns in listed companies in sectors such as Technology and Financials.

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