Mumbai: India is expected to sustain strong M&A momentum, including cross-border deals, as investors take a long-term view despite macro headwinds, top executives said at the Mint India Investment Summit.
“It’s interesting how the last three quarters over 2025 have shown the ability of investors to digest any volatility, price it in if required and proceed with M&As as they see sense in it over a 5–10-year horizon,” Devarajan Nambakam, co-head of India investment banking for Goldman Sachs Group, said at the summit last week.
“This is probably going to be tested more this year than last, but the ability of investors to see through these volatilities has been the biggest mindset shift.”
With India being a robust growth economy, there is demand for capital to accelerate this pace and for shareholders looking to monetize their stake among others, he added.
“From a supply perspective, it’s safe to say that almost no pool of capital is unavailable in India be it strategic capital, private equity, private credit or hybrid capital. Today, the quantum of the capital that is available is higher than we’ve seen. This natural matching of demand and supply has driven momentum and created resilience despite any geopolitical undercurrents,” Nambakam said.
Market evolution
Ashish Jhaveri, managing director & head of India investment banking, Jefferies, also alluded to the evolving M&A landscape in the country. “In the early 2000s, India was more about foreigners looking to get market access, and private equity funds had just begun coming into the country. We had the vision but lacked the ability to execute at scale. Even capital was expensive and not abundantly available,” he noted.
“But a lot has changed over the years. Several new sectors like infrastructure, real estate, EMS and e-commerce have been created in the last two decades. We have seen healthcare and pharma become far deeper. So, when you look at the deal-making that has happened in the last five years, it's been very distributed and across sectors,” Jhaveri said, adding that the market depth is large and spread across multiple sectors. “There is a decent mix of private equity and corporates taking part in transactions today.”
These comments come as global investors identified India as one of the key geographies to make money and exit, owing to the country's rich valuations. Earlier this month, global consulting firm McKinsey noted that India has emerged as an increasingly attractive destination for limited partner (LP) allocators, and its regional weight has increased amid China’s slowdown.
“The real M&A activity began in 2005 when India went on a shopping spree. Post-covid, the structural behavior has changed, and we are seeing an evolution in domestic deal making. India has seen a robust governance framework, and we are working with the who's who of the private equity world, where governance is key. Without a governance framework, it wouldn’t have been possible,” said Alok Malpani, chief executive officer at Emirates NBD Capital India.
Last year, Emirates NBD announced its decision to buy a controlling stake in RBL Bank for $3 billion, marking the largest foreign direct investment in India’s banking sector to date. Mint reported in October that this is likely to pave the way for more global banks looking to have an India play.
Broadly, India has seen improved performance in investment activity with private equity and venture capital deals expanding 1.6-fold to $207 billion between 2016–20 and 2021–25. Exits for the same period more than doubled to around $120 billion, McKinsey estimated in the report.
“There are outbound M&As happening for the sake of growth, which shows that there is enough capital generation happening with businesses inside India, a sign of a very mature ecosystem,” Goldman’s Nambakam said. “Cross-border transactions spanning inbound or outbound deals are always transformational in nature, and businesses never do it for a two–year time period. They are always done with the ambition of becoming a global business over a long-term horizon,” he said.
Investors continue to evaluate currency and political stability, which has caused renewed optimism about executing transactions in India across M&As and capital markets. But with the ongoing West Asia crisis, global investors are taking a more calibrated approach to investing outside their home country.
“People are waiting and evaluating how to navigate the current crisis. There are some sectors which are globally focused, and there are some sectors which are far more domestic where people have started thinking about second or third-order impact,” Jhaveri said. “This is transient in our view… we continue to see a lot of conversations in sectors like financial services, healthcare, infrastructure and renewables,” he concluded.