In February, India Inc witnessed a surge in private equity (PE) investments, with 154 deals amounting to $2.5 billion, despite a dip in overall values, as per a recent report. The standout transaction of the month was Mizuho Bank's investment in Kisetsu Saison India, which infused confidence in the domestic market, contributing nearly 21% to the mergers and acquisitions (M&A) activity, according to findings by Grant Thornton Bharat.
Shanthi Vijetha, Partner, Growth at Grant Thornton Bharat, commented on the stability observed in India's deal market amidst global turbulence. While M&A activity experienced a notable decline in value, PE investments continued their upward trajectory, albeit with reduced figures. Looking ahead, despite short-term volatility, Vijetha expressed optimism in India's strong fundamentals and economic recovery, which are expected to bolster investor confidence.
In February, the Indian M&A landscape recorded 38 deals amounting to $670 million, indicating a 7% decrease in volumes. Meanwhile, the PE space witnessed 106 deals totaling $0.8 billion. Although PE activity marked the third-highest monthly deals in the past year, it registered the lowest monthly values since August 2020.
Among the notable transactions, Consortium of Investor's $95 million investment in Capillary Technologies in the IT and ITeS sector stood out as the largest deal. Start-ups emerged as significant players, representing 37% of total deal volumes and 19% of values in February. Notably, the consumer retail and enterprise application segments within the start-up sector made substantial contributions, comprising 40% of the sector's deal volumes.
Additionally, the automotive sector witnessed a notable uptick, reaching its second-highest point since July 2023, primarily fueled by investments in electric vehicles. Investments in electric vehicles amounted to $69 million out of the total automotive industry deal value of $102 million, as highlighted in the report.
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