After a tough year for private equity market players in China, with the volume and value of deals plunging, funds will be more focused on value creation in 2013, according to a report released in Shanghai on Wednesday.

According to the report by Bain & Company, entitled China PE Survey 2013, about 40 percent of respondents said they would focus on value creation capacity in 2013 instead of multiple expansion and profit gains, which used to be considered major contributors to returns.

The report was based on a survey that polled 18 funds, a mix of Chinese, Asian and global companies.

Deal exits continued to decline in 2012, down 38 percent from 2011 with a corresponding 46 percent decrease in value, mainly due to sharp declines in the initial public offering market, which in turn fell by 61 percent from 2011, the report said.

As many as 70 percent of funds surveyed expect more exits in 2013, the report said.

China's growth is slowing sharply as factors that acted as a tailwind for GDP export conditions - strong capital flows, favorable export conditions and a growing labor force - are now reversing and beginning to weigh the economy down, said Vinit Bhatia, partner and head of private equity practice with Bain China.

"This economic slowdown is forcing a shift in the deal investment thesis like never before to profit growth versus multiples expansion, and this requires funds to really step up their differentiated value creation capabilities," said Bhatia.

Analysts said portfolio management would gain increasing importance for funds in China, a natural trend that has been observed in relatively more mature market such as in the US.

The private equity market is relatively young in China and portfolio management may face challenges, but enhancing value creation capability will benefit investors and companies in the long run, said Michael Thorneman, managing partner and head of Bain China.

The difficulty of finding attractive new deals with reasonable valuations in the short term as well as challenges to existing portfolio companies are the two major drives for funds to focus on existing portfolio, added Kiki Yang, Partner, co-head of private equity practice at Bain China.