Amidst a turbulent global economic scenario, India Inc recorded a total of 154 deals at $2.5 billion in February, recording a 1% fall in volumes and a 77% decrease in values from the previous month. There were no billion-dollar deals and only one deal that crossed $100 million, compared to six such deals in January, according to a report by Grant Thornton Bharat.
Mizuho Bank’s investment in Kisetsu Saison India was the top deal of the month, which contributed nearly 21% to the M&A deal activity.
The M&A space recorded 38 deals at $670 million, a 7% fall in volumes and a 52% fall in values. This was mainly due to undisclosed deal values. Domestic and outbound deal activity fell in both volumes and values, while inbound values surged by 81% to $217 million in February from $120 million recorded in January.
Inbound volumes also soared by 50%, an indication of heightened interest from foreign investors, it said.
“India’s deal market in February reflected stability amidst turbulent global conditions. While M&A activity saw a significant decrease in value, PE investments continued an upward trend, albeit with lower values. Looking ahead, despite short-term volatility, strong fundamentals and economic recovery are poised to revive investor confidence in India,” Shanthi Vijetha, partner, growth, at Grant Thornton Bharat said.
The private equity (PE) space witnessed 106 deals at $800 million, indicating a 5% rise in volumes but a whopping 84% fall in values compared with January. While PE activity recorded the third-highest monthly deals in the past year, it marked the lowest monthly values since August 2020.
The month saw only one deal over $50 million. The biggest deal was consortium of investor’s investment of $95 million in Capillary Technologies in the IT & ITeS sector.
In February, the dynamism of start-ups was evident in India’s deal landscape, dominating both in terms of volume and value. Start-ups commanded a significant portion, representing 37% of total deal volumes and 19% of values.
Consumer retail and enterprise application segments within the start-up sector contributed substantially, constituting 40% of sector’s deal volumes. Regarding deal values, the travel, transport, and logistics sector emerged as a frontrunner, capturing nearly 30% of the overall start-up activity.
The IT and ITeS sector also saw robust growth, with deal volumes and values rising by 22% and 12%, respectively. In the automotive sector, deal volumes reached their second-highest point since July 2023, fuelled by investments in electric vehicles, totalling $69 million out of the total automotive industry deal value of $102 million.
