India's M&A, PE Deal Value Slumps 48% To $17 Billion In April-June On Global Headwinds

India's merger & acquisition and private-equity deals declined sharply by 48% in value terms to $17 billion in the April–June period of 2025, compared to the preceding three months, dragged by mounting global uncertainties and a cautious business investment climate.

According to consultancy firm Grant Thornton Bharat, in volume terms, India's M&A and PE deals dropped 13% to 582 between April and June compared to the January-March period. This marks the lowest quarterly deal value since the April-June period of 2023. After excluding public market activity, 554 deals were recorded, with a combined value of $12.8 billion.

The period saw a notable slowdown, marked by a decline in average deal sizes from $43.7 billion to $29.1 billion. The downturn was largely driven by a significant 81% drop in domestic M&A values compared to January-March, coupled with absence of high-values deals across segments. Despite a 23% increase in deal volumes compared to the same period last year, overall deal values decreased by 20%.

According to Grant Thornton, the decline in volumes is attributed to ongoing geopolitical tensions, including the Israel-Iran war, policy uncertainties surrounding the Trump presidency, the Russia-Ukraine war, and surging gold prices, which collectively dampened investor sentiment.

"Despite the slowdown, the sustained momentum in private equity investments, the emergence of new unicorns, and a promising uptick in public market activity towards the quarter-end are encouraging indicators," Shanthi Vijetha, partner at Grant Thornton Bharat, said. "The quarter witnessed steady activity in sectors like banking and infrastructure, signalling continued investor confidence in India's long-term growth story."

M&A activity mirrored the overall market trend, with 197 deals worth $5.4 billion — the lowest since the April-June period of 2023. Only a billion-dollar deal was recorded (Sumitomo Mitsui Banking Corp.'s $1.57-billion investment in Yes Bank), compared to four logged between the January and March period of 2025.

The banking sector emerged as the top contributor, accounting for nearly half the deal value through three high-value transactions. Cross-border M&A also reflected global investor caution, with outbound deals plunging 25% in volume and 74% in value, while inbound deals held relatively steady, signalling selective confidence in the Indian market.

PE activity, while declining from the previous quarter, still saw the second-highest deal volume since the October-December period of 2022, with 357 deals totalling $7.5 billion. About 18 high-value deals (> $100 million) amounting to $4.6 billion — down from 21 such deals worth $6.1 billion between January and March.

The top five PE transactions contributed to 35% of the total value, with Warburg Pincus and Abu Dhabi Investment Authority's $862 million investment in IDFC First Bank standing out as the largest deal of the quarter.

"As anticipated in 2024, the PE landscape in 2025 remained focused on sectors with strong fundamentals and long-term resilience," said Vishal Agarwal, partner at Grant Thornton Bharat. "Banking and financial services, infrastructure, and retail and consumer emerged as the top three sectors in H1 2025."

"Automotive, real estate, and IT & ITeS also maintained a steady pipeline of activity," Agarwal said.

Public market fundraising remained subdued during the period, as IPO activity declined for the third consecutive quarter. There were 12 IPOs raising a total of $1.9 billion, a 25% decrease in volume and a 26% drop in value compared to the January-March period.

However, June showed signs of recovery, posting the second-highest monthly IPO numbers and values for the year, led by major listings like Leela Hotels ($407 million), Ather Energy ($343 million), and Aegis Vopak Terminals ($326 million).

On the QIP front, activity remained stable with 16 issuances totalling $2.2 billion, nearly mirroring the previous quarter. The banking sector led the way, with six banks raising $1.1 billion, accounting for 49% of the quarter's QIP values.