Indian dealmaking witnessed a total of 501 deals in Q2 2024, valued at $21.4 billion, stated Grant Thornton Bharat Dealtracker, Q2 2024 report. The Q2 recorded the highest quarterly volumes since Q2 2022, while values declined due to absence of big-ticket M&A transactions. Per the details, M&A and PE deals together stood at 467, valued at $14.9 billion. This reflects a 9 per cent increase in volumes, however, in value terms, deals posted a decrease of 28 per cent, primarily due to the previous quarter’s $8.5 billion Reliance-Disney mega-merger. The quarter featured one-billion-dollar deal and 30 high-value deals (over $100 million), marking a 58 per cent increase in high-value deals compared to the previous quarter, which had only 19 high-value deals including three billion-dollar deals.
Indian corporates are increasingly investing domestically, reflecting strong confidence in the local investment climate. Grant Thornton Bharat said that despite declining crossborder deals due to geopolitical instability, traditional sectors grew in volumes over the previous quarter. Further, it added that with recent election results and anticipated policy clarity from the upcoming budget, political stability is expected to boost investor confidence and drive deal activity in the next six months.
Shanthi Vijetha, Partner, Growth, Grant Thornton Bharat, said, “The quarter witnessed robust private equity activity and large domestic deals. Despite a decline in cross-border deals due to geopolitical uncertainties, domestic investment remained strong. Traditional sectors like pharma and manufacturing also saw strong deal flows, collectively contributing nearly half of the deal values. With the government entering its third term after the recent elections, the industry anticipates policy continuity, which should positively drive the deal activity.”
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M&A activity
During Q2 2024, M&A activity saw 132 deals worth $6.2 billion, posting an increase in volumes and also a substantial 50 per cent drop in values. Per the report, domestic deals drove this growth, with volumes rising by 29 per cent and values increasing 2.5 times compared to Q1 2024. This surge was largely due to four high-value deals by the Adani group in the industrial materials and ports sectors. This accounted for 52 per cent of the total M&A values for the quarter. In contrast, cross-border deals experienced a decline, with volumes decreasing by 24 per cent and values plummeting by 85 per cent as compared to Q1 2024.
Private Equity (PE) landscape
In Q2 2024, the private equity (PE) landscape saw a growth, with 335 deals during the period totaling $8.7 billion. This marked a 9 per cent increase in volume and a 55 per cent increase in value since Q1 2024. The quarter in review marked the highest volumes since Q2 2022, and second highest values with 21 high-value deals (≥ $100 million) accounting for 68 per cent of the total PE values. According to Grant Thornton Bharat, PE transactions dominated the overall deal landscape, comprising 72 per cent of the total deal volume and 59 per cent of the total values. Despite small-ticket transactions (under $7 million) dominating deal volumes with a 53 per cent share, they contributed only 4 per cent to the total values, underscoring the concentration of value in larger deals within the PE sector during the quarter.
QIP & IPO landscape
There were 20 QIPs totaling $2.3 billion, reporting an increase in both values and volumes over the previous quarter, with volumes marking the second highest since Q4 2017. As for IPOs, there were 14 IPOs totaling $4.2 billion, representing the highest quarterly IPO size since Q2 2022 despite a 42 per cent decline in the number of IPOs compared to the previous quarter, indicating a trend towards fewer but larger IPOs.
Sectoral performance
In terms of sectors, retail and consumer segments emerged as a dominant force in deal activity despite a 7 per cent decrease in volumes, posting an 18 per cent increase in values over Q1 2024. The IT & ITes sector recorded a 9 per cent increase in volumes but faced a decline in average deal value, with tech start-ups leading both volumes (47 per cent) and values (36 per cent). Meanwhile, the pharma, healthcare, and biotech sector achieved $3.8 billion in values, largely influenced by high-value deals and substantial PE investments accounting for 68 per cent of volumes and 65 per cent of values. The manufacturing sector saw a 28 per cent increase in volumes and a 9x increase in values, driven by high-value deals in industrial materials led by the Adani group. Other sectors like professional services and aviation gained traction, while agriculture, transport, logistics, and real estate sectors surged. However, sectors such as infrastructure, education, hospitality, leisure, and media witnessed declines in overall deal numbers during Q2 2024, the report stated.
From: financialexpress
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