Grant Thornton Bharat presents the 19th annual edition of the Dealtracker, our pioneering publication on mergers and acquisitions (M&A) and private equity (PE) deals in India. This edition provides deal insights for 2023.
Key highlights of the publication:
- The year 2023 ended positively for the Indian economy, with expectations of GDP growth exceeding 6.5% in the fiscal year 2023-2024.
- The year recorded over 1,500 deals totalling around USD 53 billion, showing a 23% decrease in volumes and a 59% decrease in values compared to the previous year.
- While there was a slight increase in cross-border transactions from around 120 to 140 in 2023, their collective value sharply declined from USD 21 billion to USD 11 billion. This indicates a noticeable shift towards smaller deals.
- PE deal activity continued to be low, recording around 1,000 deals worth USD 27 billion on the back of cautious investor sentiment and the prevailing funding winter across the globe.
- The outlook for 2024 is uncertain, contingent on economic climate, geopolitical stability, and investor sentiment. Despite challenges, there is optimism, with M&A and PE firms actively seeking opportunities aligned with long-term objectives. Sectors such as ESG initiatives are poised for growth.
M&A snapshot
- M&A activity in 2023 recorded 494 deals, reflecting a 3% increase in deal volume but a significant 72% decline in values compared to the previous year, which saw three deals valued over USD 10 billion each.
- The first half of the year experienced a slowdown, with deals amounting to USD 7.8 billion, while the latter half saw an uptick, reaching deals worth USD 17.5 billion. Domestic deals dominated the landscape, with 350 deals valued at USD 14.4 billion, indicating a substantial share of the market.
- Inbound activity witnessed substantial growth, featuring 84 deals totalling USD 7.7 billion, showcasing increased interest from foreign investors.
- Outbound activity remained stable, but values declined significantly from USD 17.9 billion in 2022 to USD 3.2 billion in 2023.
- Start-ups led deal volumes, with IT and pharma contributing 42% of the deals. However, these sectors witnessed a decline in volumes from 239 in 2022 to 208 in 2023. Real estate, energy, and pharma led in values with a 39% share, demonstrating diversification across various sectors.
PE snapshots
- In 2023, the private equity sector saw 1,045 deals totalling USD 27.4 billion, marking a 32% decrease in volumes and a 23% decline in values compared to the previous year.
- Despite the decrease in overall values, the average deal value rose from USD 23 million to USD 26 million.
- Startups led in volumes but faced a 42% decrease, amounting to USD 2.6 billion. Within startups, the retail sector contributed the most deals (20%), followed by FinTech (15%) and SaaS (14%).
- Following startups, the e-commerce, and IT sectors comprised 181 deals totalling USD 5.5 billion.
- The pharmaceutical sector led in PE values, followed by e-commerce, energy, and banking, contributing to 56% of the PE values, totalling USD 15.3 billion.
Previous publication
Monthly Dealtracker – November 2023
