India’s mergers and acquisitions (M&A) and private equity (PE) landscape saw a sharp rise in February, with deal volumes hitting a three-year high, despite global economic uncertainties.
According to the latest Grant Thornton Bharat Dealtracker, the month recorded 226 M&A and PE deals worth $7.2 billion, reflecting a 67 percent year-on-year surge in volumes and a 5.4x increase in values compared to February 2024.
The strong performance signals growing investor confidence in India’s economic trajectory, supported by strategic acquisitions and policy tailwinds from Union Budget 2025. Even as foreign portfolio investments in Indian equities declined and concerns over trade tariffs loomed, the domestic dealscape remained resilient, bolstered by corporate expansions and sector-specific consolidations.
“The Indian deal landscape continued its strong start from January into February by clocking the highest monthly deal volumes over the last three years. M&A and PE deals are expected to sustain this momentum, with support from 2025 budgetary proposals and sectoral tailwinds especially in manufacturing, energy, infrastructure and banking”, said Shanthi Vijetha, Partner, Growth at Grant Thornton Bharat.
Meanwhile, India’s overall deal landscape witnessed a remarkable surge in February 2025 with a total of 233 deals valued at $ 9.1 billion, including Initial Public Offerings (IPOs) and Qualified Institutional Placements (QIPs)
M&A Sees Record Volumes Despite Declining Values
February’s M&A activity set a new benchmark with 85 deals, marking a 23 per cent jump in volumes over January. However, deal values slipped 11 per cent to $4.7 billion, continuing a downward trend since December 2024. The drop in values suggests a market shift towards mid-sized deals rather than mega transactions.
Domestic deals dominated the M&A space, accounting for 68 per cent of the total volume and 78 per cent of the overall deal value. While inbound M&A activity weakened, outbound deals saw notable traction as Indian companies pursued international expansion. Key acquirers included Zen Technologies and Nitco, each closing four acquisitions and contributing to the rise in deal volumes.
The month’s largest transaction was ONGC NTPC Green Pvt. Ltd.’s $2.3 billion acquisition of Ayana Renewable Power Pvt. Ltd., underscoring continued interest in India’s renewable energy sector.
PE Investments Maintain Upward Trajectory
Private equity investments also maintained strong momentum in February, with 141 deals totaling $2.4 billion. This represented a 9 per cent increase in deal volumes and a 16 per cent rise in value compared to January. The month recorded the highest PE deal volume since May 2022 and marked the fourth consecutive month of increasing investment activity.
Early-stage funding was a key driver, with seed and pre-Series A rounds accounting for nearly half of all PE transactions. Seed funding led the way with 30 deals, followed by pre-Series A with 12 deals and pre-seed funding with 11 deals.
However, larger PE deals remained relatively scarce, with only 15 transactions exceeding $50 million. The biggest PE deal of the month was Cube Highways Infrastructure Investment Trust’s $487 million acquisition of Quazigund Expressway and Athaang Jammu Udhampur Highway, highlighting continued investor interest in infrastructure assets.
Sectoral Trends: Retail, IT, and Manufacturing Lead Growth
Several sectors stood out in February’s dealmaking:
- Retail & Consumer: Recorded its highest monthly deal volume since January 2022, driven by acquisitions in textiles, apparel, and e-commerce.
- IT & ITES: Continued to attract investors, with deal values rising 12 per cent.
- Manufacturing: Saw a 50 per cent surge in deal volumes, reflecting a resurgence in industrial activity.
- Media & Entertainment: Deals jumped from 4 to 17, with values soaring from $1 million to $1.1 billion.
- Energy & Natural Resources: Led in deal values, accounting for 32% of the total, primarily due to large renewable energy investments.
However, some industries saw a decline in deal activity, including pharmaceuticals, healthcare, automotive, infrastructure, aerospace, logistics, and agriculture, indicating shifting investor priorities.
IPO and QIP Markets Face a Slowdown
Despite strong M&A and PE activity, India’s primary market saw a sharp drop in fundraising. IPO and Qualified Institutional Placement (QIP) volumes fell by 67 per cent and 57 per cent, respectively, amid economic uncertainty, rising inflation, and geopolitical tensions.
The market downturn was reflected in lower corporate earnings and regulatory challenges, discouraging public offerings. However, one bright spot was Hexaware Technologies’ $1 billion IPO, marking the highest monthly IPO value raised since November 2024.
Looking Ahead: Strong Deal Activity Expected to Continue
Market experts believe India’s strong deal momentum will persist in the coming months, supported by policy measures outlined in the Union Budget 2025. Key sectors such as manufacturing, energy, infrastructure, and banking are expected to drive further deal activity.
As India’s corporate sector continues to expand, strategic acquisitions and PE investments are likely to play a pivotal role in shaping the country’s economic growth in 2025, they said.
