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MUMBAI : Merger and acquisition (M&A) activity in India reached a three-year high with deals worth $90.4 billion struck in the first nine months of 2021, a 35.1% increase compared to the same period a year ago, according to a report by financial markets tracker Refinitiv. The deal count grew 10.1% year-on-year.

Average deal value during the first nine months of 2021 totaled $105 million, up 14.4% year-on-year, as 17 deals above $1 billion were announced during this period. These 17 deals reached a cumulative $38.8 billion, compared to 12 deals worth above $1 billion with a total of $30.1 billion in the first nine months of last year.

Domestic M&A activity amounted to $34.5 billion, up 14.1% in value compared to last year. Piramal Capital & Housing Finance Ltd, a unit of Piramal Finance Ltd, acquired the entire share capital of Dewan Housing Finance Corp Ltd for a total of $4.7 billion ( 342.5 billion), which was the largest deal in the first nine months.

India’s inbound M&A activity grew 66.4% from a year ago and reached $48.6 billion – the highest first nine months period since records began in 1980.

The US was the most active foreign acquirer in India with $20.3 billion worth of deals, up 19.3% from a year ago and accounted for 41.7% market share of India’s inbound M&A.

Outbound M&A transactions hit a three-year high and totaled $4.5 billion, up 18.2% from a year ago. The UK was the most targeted nation in terms of value from Indian companies with 15 deals worth $2.1 billion, or 47.2% market share, while the US saw the greatest number of acquisitions with 41 deals worth $1.4 billion, or 31.6% market share.

Majority of the deal-making activity involving India targeted the financial sector which totaled $21.9 billion in deal value, up 156% from a year ago and captured 24.2% market share. Energy and power accounted for 15.2% market share after a 12.1% growth in value to $13.7 billion. High technology, which saw the highest number of deals, captured 14.0% and saw a 182.7% year-on-year growth in value worth $12.7 billion.

On the other hand, Indian equity capital markets (ECM) raised $22.1 billion during the first nine months of 2021, a 32.7% decline in proceeds from the first nine months of 2020, despite a 65.6% growth in the number of ECM offerings as deals were done in smaller value.

Follow-on offerings, which accounted for 58% of India’s overall ECM proceeds, raised $12.7 billion in the first nine months of 2021, down 57.1% from a year ago, but the number of follow-on offerings grew 23.0% year-on-year.

Initial public offerings (IPO) from Indian issuers across diverse sectors hit record levels wit companies cumulatively raising $9.2 billion in the first nine months of 2021, more than four times the amount raised in the same period last year. The number of IPOs also jumped 160.7% year-on-year.

More than half of the IPO proceeds were raised during the third quarter of this year which saw 34 IPOs worth $5.1 billion. Zomato’s $1.3 billion IPO in July is the largest Indian deal so far this year, and the biggest IPO since SBI Cards & Payments Services’ $1.4 billion listing in March 2020.

ICICI Bank Ltd currently leads the ranking for India’s ECM underwriting with $2.5 billion in related proceeds and 11.3% market share, the Refinitiv report said. JP Morgan and Axis Bank rounded out the top three, capturing 9.5% and 8.8% market share, respectively.

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