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India’s corporate landscape is transforming as mergers and acquisitions (M&A) and private equity (PE) investments continue playing pivotal roles in reshaping businesses across sectors. The large and growing economy, burgeoning middle class and favourable regulatory environment present a compelling market for strategic deals.
Against a global trend of moderate deal-making, India’s M&A landscape experienced a remarkable revival in 2024. In the first nine months, total deal value increased by 66% compared with 2023, driven by several large transactions. In contrast, global deal value grew by just 10%, while Asia-Pacific declined 5%. Although deal volume fell by 3%, the decline was less severe than the global drop of 13%, or Asia-Pacific’s 13% decrease.
Natashaa Shroff
Partner
Shardul Amarchand Mangaldas & Co
Venture capital (VC) and growth equity investment saw a year-on-year increase of about 25%, rising to USD6.6 billion, driven by a strong 35% surge in deal volumes. Several key trends are emerging in the M&A landscape.
Exit strategies and IPOs: The market saw a resurgence in IPO activity, with many companies including Swiggy, Hyundai India and Ola Electric successfully listing, providing private equity firms with lucrative exit opportunities. PE investors are expected to continue targeting IPOs as a primary exit route, benefitting from strong market sentiment towards growth-oriented businesses.
Continued digitalisation is also driving investor confidence, with companies in fintech, healthcare and health-tech, logistics and e-commerce generating significant interest from both public markets and private equity firms. Raising USD3.3 billion, Hyundai Motor India’s IPO – the nation’s largest IPO ever – demonstrated the advantage of listing in India’s strong equity market, which offers higher valuations than global peers.
This sets a precedent for other multinational companies looking to unlock value and raise capital through domestic listing.
Taranjeet Singh
Partner
Shardul Amarchand Mangaldas & Co
Sectoral trends: 2024 witnessed a significant shift in sectoral investments, with information technology (IT) and information technology-enabled services (ITeS), quick commerce, healthcare and consumer technology standing out.
IT/ITeS deal activity saw a strong rebound, with investments almost trebling from 2023. Mega deals included Viacom 18 Media’s merger with Star India, and the proposed merger of Aster DM Healthcare and Quality Care India to create India’s third-largest hospital chain. The trend of sectoral consolidation is expected to remain a key trend in 2025.
Cross-border M&A: India remains an attractive destination for foreign direct investment (FDI), particularly from global giants looking to enter or expand in Asia. With favourable policies under the “Make in India” and PLI (Production Linked Incentive) initiatives, multinational companies seem keen to acquire Indian businesses providing them with strategic market access, local manufacturing and an alternate supply chain. Conversely, Indian companies are also evaluating foreign market acquisitions to enhance their global footprint, especially in pharmaceuticals, information technology and energy.
Deepa Rekha
Partner
Shardul Amarchand Mangaldas & Co
Regulatory support: The government is nurturing an environment conducive to M&A by improving regulations, simplifying the cross-border merger process and enhancing transparency.
The framework for an inbound cross-border merger of a foreign holding company and its wholly owned Indian subsidiary has been simplified. A recent amendment eliminated the need for National Company Law Tribunal approval. It is now permitted under the fast-track merger route. This is likely to push a wave of reverse flips to India as businesses look at Indian IPOs in the next two years.
ESG and impact investing: Environmental, Social, and Governance (ESG) factors are becoming an important consideration for PE firms globally as investors increasingly align their strategies with sustainability and social impact. Companies in sectors like renewable energy, agritech, and sustainable consumer goods are seeing higher PE interest, reflecting a broader shift towards responsible investing.
Takeaway: As India’s economy continues to grow, rapidly evolving M&A and PE strategic investments are being shaped by sectoral trends, digital transformation, regulatory improvement and changing global economic conditions. In the long term, deal making is expected to remain strong.
Natashaa Shroff, Taranjeet Singh and Deepa Rekha are partners at Shardul Amarchand Mangaldas & Co. senior associate Vardhman Mehta also contributed to this article.
Shardul Amarchand Mangaldas & Co
Amarchand Towers, 216,
Okhla Phase III, Okhla
Industrial Estate Phase III,
New Delhi, Delhi 110020
Executive Chairman:
Shardul Shroff
Managing Partner:
Pallavi Shroff and Akshay
Chudasama
Contact details:
T: +91 11 4159 0700
E: Connect@AMSShardul.com
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