The July-September 2023 quarter witnessed 302 investment deals, including merger and acquisition (M&A) and PE deals, with values amounting to $13.4 billion, according to a report by Grant Thornton Bharat. Start-ups, e-commerce, IT and ITeS saw the most deals accounting for 64 per cent of the total deals in terms volume.
“The quarter in 2023 witnessed a deal volume of 302 deals with values amounting to $13.4 billion. This comes on the back of persisting declining global trade and potential higher US interest rates until 2024,” Grant Thornton said in the report.
E-commerce dominated values, followed by pharma, IT, and retail, contributing 63 per cent of the quarter’s total values.
Shanthi Vijetha, partner (growth) at Grant Thornton Bharat, said, “India’s unwavering commitment to global cooperation and its demonstrated economic resilience has positioned the country for a promising future in deal activities. With a robust GDP growth in Q1FY24 and a strategic emphasis on multilateralism, India is poised to weather challenges.”
Vijetha added that while concerns persist over declining global trade and potential US interest rate hikes, stable M&A deals in Q3 2023, with six mega deals, suggest a positive near-term outlook.
“With growth-oriented policies, reduced inflation, and increased infrastructure spending, India’s domestic growth is set to fuel deal activities, particularly in traditional sectors (pharmaceuticals and healthcare) and the ever-accelerating digital transformation landscape (e-commerce and IT & ITES),” Vijetha said.
Mergers and Acquisitions Landscape
This quarter recorded high M&A activity for this year in terms of both deal volumes, with 82 deals valued at $7.7 billion. Volumes represent a 4% increase from Q2, while values represent a 243% increase. The top five M&A deals of the quarter constituted 53% of total M&A values.
Private Equity Landscape
The PE sector recorded its lowest figures, impacting the overall deal activity in Q3 2023. Just 220 deals valuing $5.7 billion were recorded, a 17% decline in volumes, whereas a 49% decline in values was witnessed over the previous quarter, Q2 2023. The top five PE deals of the quarter constituted 42 per cent of total PE values, with Qatar Investment Authority’s investment in a 1 per cent stake of $1,010 million being the top deal.
Year-to-Date
There was a significant drop in deal activity compared to the same period
in 2022. Overall, there was a 39% decrease in the number of deals and a 68% decrease in their total values. This decline was particularly pronounced in M&A, where values plummeted by 83%. This steep drop can be attributed to the absence of some of the massive billion-dollar deals witnessed in the YTD period 2022. In the PE sector, there was a 40% reduction in the number of deals and a 28% decrease in their values compared to YTD 2022.
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