India’s M&A deals soar to $126.09 billion

Mergers and acquisitions(M&A) in India skyrocketed to a monumental $126.09 billion across 1,185 deals during the year 2022- an absolutely staggering 141% growth rate! This surge can largely be attributed to the humongous HDFC Bank and Housing Development Finance Corporation merger which was estimated at a huge $57 billion; greater than all 2021 deal sizes combined ($52.31). It also stands as one of India’s largest corporate transactions ever recorded!

Adani Group made history with its $10.5 billion purchase of Switzerland-based Holcim Group’s complete stakes in two Indian firms, Ambuja Cements and ACC – the largest acquisition ever for Adani and the biggest M&A transaction in India’s infrastructure & materials sector to date.

The third largest deal of the year happened to be a $3.3 billion merger between two Larsen & Toubro subsidiaries, L&T Infotech and Mindtree.

Steel producer ArcelorMittal’s branch, AM/NS India, recently purchased two port assets and a power plant from the Essar Group for approximately $2.4 billion in net value. Additionally, Axis Bank acquired Citibank’s consumer business in an all-cash deal worth $1.6 billion – both standing at the peak position according to Bloomberg data!

In 2022, M&A deals skyrocketed by a whopping 2.41 times from 2021’s figure of $52.31 billion – constituting an increase of 26.7% compared to the 935 transactions recorded in that same year! The most noteworthy deal in 2021 was Piramal Group’s acquisition of Dewan Housing and Finance for a scintillating sum of $4.7 billion, while HDFC Bank’s merger with another company easily took the top spot this year as its total came up to an incredible $57 billion!

Sonia Dasgupta – MD & CEO, Investment Banking, JM Financial said in a statement-

“India has bucked the global downward trends in M&A and witnessed record deals in 2022. The domestic deals accounted for a sizeable share of the deals (72% by value and 52% by volume), and as far as sectors are concerned, technology and financial services constituted major deal value taking up over 30% of the entire deal value. Going forward, we expect the momentum to continue due to attractive valuations and stronger balance sheets.”

Although acquisitions alone saw a decrease, the deal size for 2022 dropped to $2.8 billion, compared with 2021’s $3.8 billion stated by Tracxn Technologies data. Even so, there were 634 deals in 2022 as opposed to 541 from the year before – demonstrating that investors can still trust acquisitions during this period of uncertainty and flux.

India achieved a remarkable feat in the second quarter of 2022, showcasing an astonishing $82 billion worth of completed and pending mergers & acquisitions – over two times more than its former record from 2019’s third quarter! This groundbreaking data was collected by Bloomberg.

With the nation’s economy on an upswing, analysts predict that deal momentum will make further gains in 2023. However, we must be cautious and keep a close eye on any potential second wave of Covid-19 outbreaks while continuing to monitor economic growth projections.

A Morgan Stanley report recently predicted that India, due to its large investments in technology and energy, is poised to become the world’s third-largest economy by 2027. This will be a major shift as it would surpass Japan and Germany who are currently occupying this position.

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