India sees record deal activity in February at USD 7.2 billion

India witnessed a record-breaking surge in deal activity in February, with 226 M&A and private equity deals totaling USD 7.2 billion -- the highest monthly deal volume in the last three years, according to the Dealtracker report of Grant Thornton Bharat.

"This represents a 67 per cent increase in volumes and a 5.4-fold increase in values compared to February 2024, while a 14 per cent increase over the previous month," it said.

As many as 85 merger and acquisition (M&A) deals worth USD 4.8 billion were announced in February. Domestic deals constituted 68 per cent of M&A volumes and 78 per cent of total values. Outbound deals surged, while inbound deal values declined sharply.

"Despite global economic uncertainties, including declining foreign investments in Indian public markets and looming trade tariffs, Indian dealscape demonstrated resilience, driven by robust domestic demand," it added.

Zen Technologies and Nitco Ltd were key acquirers, each acquiring four companies, contributing significantly to the volume growth, the report said.

Significant deals in February included ONGC-NTPC Green's USD 2.3 billion acquisition of Ayana Renewable Power.

The Praana Group's USD 755 million acquisition of Owens Corning's glass reinforcement business accounted for 89 per cent of the manufacturing sector's total value.

Media and entertainment segment saw a sharp uptick in sports and gaming deals, including Torrent Group's USD 872 million acquisition of Irelia Sports (Gujarat Titans).

Total 141 transactions worth USD 2.4 billion made up for the private equity (PE) deals, it said, adding this was the highest PE volume since May 2022, with continued month-on-month growth since November 2024.

Early-stage investments (Seed to Series A) dominated, forming nearly 50 per cent of total PE volumes.

Key PE transactions included Cube Highways' USD 487 million investment in two road projects (Quazigund Expressway & Athaang Jammu Udhampur Highway), and Multiples Alternate Asset Management's USD 200 million investment in Qburst Technologies (IT & ITES).

"The M&A space witnessed contrasting trends (in February), with volumes steadily increasing over the past four months, while values continued to decline since December 2024. February 2025 witnessed record monthly volumes as domestic deals remained the dominant theme, accounting for 68 per cent of volumes and 78 per cent of values," the report said.

The cross-border activity was mixed, with outbound deals witnessing a significant increase both in terms of volumes and values, while inbound deal values declined significantly.

"The PE space witnessed both deal volumes and values rising month-on-month since November 2024. 
Notably, this marks the highest monthly deal volumes since May 2022," it said, adding early-stage fundings (up to Series A) had significant traction, accounting for nearly half of the total PE deal volumes." 

Retail and consumer, IT & ITES, banking and financial services, and pharma, healthcare and biotech sectors were the key drivers for volume growth, contributing 60 per cent of the overall volumes, while traditional sectors, including energy and natural resources, media and entertainment, manufacturing and infrastructure management led value growth, accounting for 66 per cent of the total values.

The report said the Union Budget 2025 proposals, including tax incentives for start-ups and MSMEs, increased capital expenditure allocations and sector-specific initiatives, are likely to drive deal activity, particularly in the manufacturing, energy and natural resources, infrastructure management, and banking and financial services space.

"As the Indian deal landscape continues to evolve, it will be interesting to see how these trends play out in the coming months," the report said.