India’s Deal-Making Activity Jumps 29.6% to $27.5 Billion in Q1 2025

In the first quarter of 2025, the mergers and acquisitions (M&A) activity in India reached a three-year high of $27.5 billion in transaction value, according to an analysis conducted by LSEG Deals Intelligence. This is an impressive increase of 29.6% year-over-year. The number of announced M&A transactions increased by 13.6%, marking Q1 2025 as the busiest quarter for M&A since early 2023.

The rise was supported by strong domestic deal-making and by a notable increase in the number of private equity-backed acquisitions.In contrast, India's equity capital markets (ECM) declined sharply in Q1 2025 from a very strong 2024.

The total capital raised by Indian issuers was at $6.5 billion, representing a significant 59% decrease year-over-year.Block trades, which had a booming year in 2024, dropped to near-zero with a decline of 85% in proceeds. The large downturn in ECM activity was exacerbated by increased volatility in financial markets as well as geopolitical and economic uncertainty, which led to a deterioration in investor confidence at the beginning of the year. Despite the woes in ECM, India continued to hold ground as a major future player in the international initial public offering (IPO) market.

Indian stock exchanges accounted for 8.8% of global IPO proceeds in Q1 2025, ranking third behind the United States (33.5%) and Japan (12.4%). This underscores India's continued attractiveness to investors, with the potential for market momentum to pick up again.

Domestic M&A activity experienced a remarkable annual increase of 145.4% to $21.6 billion, representing the first-quarter highest level since 2018. Contrarily, inbound M&A activities fell significantly, plunging down 67.8% to $3.7 billion—the lowest total in nine years. Simultaneously, outbound M&A activity soared, climbing more than three times this quarter to $2.1 billion. Investment Banking Fees: Total investment banking revenues were: $253.3 million, representing an 8% drop from Q1 2024. ECM underwriting fees were: $57.2 million, down 58%, the lowest total since Q1 2023. DCM underwriting fees were: $68.5 million, down 5%. Syndicated lending fees were: $26.1 million, 11% higher from last quarter last year.M&A advisory fees were: $101.5 million, 142% higher than last year.Leading Investment Bank: Jefferies ranked first among the investment banking category, generating $48.9 million, or 19.3% of the total fee pool.

M&A Breakdown:

Overall M&A Deal Value: $27.5 billion, up 29.6% quarter-on-quarter, and the best total for Q1 since 2022.Target India M&A: $25.3 billion, up 24.4% year-on-year.Domestic M&A: $21.6 billion, the highest Q1 total since 2018, and a stunning 145.4% increase.Inbound M&A: $3.7 billion, down 67.8% year-on-year, and a nine-year low.Outbound M&A: $2.1 billion, up 3x plus from last year.Sectors of Interest for M&A:Energy & Power: $7.3 billion, an increase of fifteen times, representing 26.7% of the market.Financials: $5.2 billion, an increase of 36% with an 18.8% market share.Media & Entertainment: $4.5 billion or an increase of 15.5%, and accounting for 16.4% of total deals.Private Equity-backed M&A: $5.3 billion, which is up 227.6% versus last year.Equity Capital Markets (ECM):Total ECM: $6.5 billion, down 59.3% year-on-year.IPO: 'related proceeds totaled $2.3 billion and were down 6.9% from Q1 2024.'Follow-on offering: 'proceeds were $4.2 billion which is down 68.8% and represents the lowest total for a Q1 since 2022.'
Sector Contributions to ECM:Industrials: $1.07 billion in total proceeds, a 16.4% sector share, down 71.3%.High Technology: $1.06 billion in total proceeds, a 16.2% sector share, down 35.5%.Telecommunications: $1.01 billion in total proceeds, a 15.5% sector share, down 23.9%.Top ECM Underwriter: Jefferies led the segment with $1.4 billion in total proceeds (21% market share).Bonds: Total Bonds Issued: $28.8 billion, a 13.8% year-over-year increase, the highest total for Q1 since 2019.Top Bond Sectors:Financials: $20.5 billion in total proceeds, 71.1% market share, up slightly by 1.4%.Government agencies: $2.97 billion in total proceeds, up 214.3%.Energy and power: $2.3 billion in total proceeds, up 10.5%.Top Bond Underwriter: HDFC Bank topped the list with $3.4 billion in proceeds (11.8% market share).