After a strong run of QIPs, block deals and IPOs, Nomura’s investment banking arm expects public-market activity to remain robust through the rest of the year, while global buyout funds continue to explore opportunities to expand their footprint in India, the firm’s top executives said.
“Over the last couple of months, we have concluded several transactions across equity capital markets, and we expect a similar supply coming in the next few months,” Nomura’s India head of investment banking Amit Thawani told Mint in an interview.
Earlier this year, Nomura was among the advisors in Ather Energy’s $135 million QIP and Sterlite Technologies’ $158 million QIP. It was also involved in two block deals worth $272 million in Anthem Biosciences and Clean Max Energy’s $509 million pre-IPO and IPO processes.
It also priced Dhoot Transmissions’ $320 million public listing in August. Its other large public market transactions over the last year include HDB Financial Services ($1.5 billion), ICICI Prudential ($1.1 billion) and Afcons’ billion-dollar pre-IPO and IPO process.
Broadly, the value of QIPs and blocks is surpassing IPOs this year as several companies tap the public markets through smaller issue sizes.
“While IPO activity has picked up significantly in the last month, the story so far seems to indicate that public listings may not meaningfully surpass last calendar year’s record levels. While the product split of the ECM market across block deals, IPOs and QIPs might vary this year, there is a high possibility that on overall ECM activity, we could get close to 2025’s levels,” said Mahesh Natarajan, Nomura’s head of India equity capital markets.
These investors are increasingly leveraging secondary or block deals as an exit or monetization option compared to an OFS in the IPO as the company scales post-listing and commands a better valuation, Natarajan noted.
Beyond IPOs
Several private equity-owned companies are also tapping the public markets at a shorter time span after the initial investment.
“In such cases, the IPO is mainly executed to unlock the optionality of a listed company primarily with the intent of raising capital through the listing rather than an exit for the investor,” he said.
Between private and public markets, the firm is bullish around sectors such as financials, consumer, healthcare, enterprise tech, industrials and infrastructure.
“We are increasingly seeing more instances of family-owned businesses looking to tap private capital before going to the public markets. The playbook has become more enlarged as there is an evolution and a shift in mindset of promoters, especially in the industrials segment,” said Manish Agarwal, who heads the industrials and infrastructure verticals.
Beyond the core areas like auto, electronic manufacturing services and other ancillary segments, other areas such as defence, aerospace and semiconductors are also sunrise segments for the global investment bank.
“There is a real demand as strategics globally are looking at India as their base for sourcing and manufacturing,” Agarwal said.
Nomura is also ramping up its presence in the new economy segment—a vertical that focuses on established and fast-growing startups. “The new economy is no longer in their nascent stages. These are young businesses that have matured over time,” Thawani explained. While they may be tech-oriented, they have “grown fast and become sizeable,” he said.
“We are growing and deepening our presence in this vertical as the deals originating from these businesses have become more relevant for us now,” he said. Nomura's transactions in the new economy vertical include Wakefit’s $170 million pre-IPO and IPO deal, Ather’s $352 million IPO in 2025, and Kreditbee’s $280 million private fundraise earlier this year.
Buyout appetite
On the private side, cross-border transactions are expected to continue although pure buyout fund activity has become more selective and measured over the last few months, according to Thawani.
Nomura has been involved in several large sell-side transactions including Blackstone’s exit from Aadhar Housing Finance, minority stake sale in Edelweiss AMC to Westbridge Capital, and strategic capital partnership for Sun Mobility with Indian Oil Corp along its private fundraise.
On the buyside, Nomura was the financial advisor on the recent Jana Small Finance Bank transaction, Blackstone’s purchase of 9.9% stake worth $705 million in Federal Bank, Japan’s JFE Steel’s acquisition of a 50% stake worth $1.75 billion in Bhushan Power & Steel Ltd from JSW Steel and Tata AutoComp Systems’ acquisition of European automotive component maker Artifex Interior Systems.
“We are at the cusp where a lot of further strategic interest into India is waiting to happen over the next 12-18 months. There is a lot of inbound interest across sectors such as industrials, financials, etc. while domestic strategics are also selectively evaluating opportunities overseas... So, it's a constantly evolving framework,” he said.
Moreover, some of the Asia-focused buyout funds with a large India exposure are sitting on dry powder that is waiting to be deployed. “They have tremendous appetite to execute big transactions in India and are extremely sophisticated investors who understand dual-track processes to leverage opportunities,” Thawani said, adding that recent exits have encouraged them to evaluate India more closely.
A dual track is a process where a company prepares for an initial public offering while exploring a transaction in the private markets.
India priority
Nomura, which was founded more than a century ago, is a financial services company with an integrated global network. Headquartered in Japan, the firm opened its India office in 2007 and has three verticals—investment banking, fixed income, and equities. Its investment banking business offers M&A advisory, equity capital markets and financing solutions.
The financing vertical spans acquisition financing, margin financing and private credit through which it helps companies with their growth requirements. With over a 40-member team in its Mumbai office, the firm sees India as a strategically important part of the business.
“Within Asia ex-Japan, India is a prominent business for Nomura and is a meaningful part of the overall franchise and we expect to grow our presence further,” Thawani said, without disclosing specific figures.