With 171 M&A (Mergers and Acquisitions) and PE (Private Equity) transactions, lack of high-value transactions and non-disclosure of values in most deals, India Inc saw a decline in deal value in July. According to a report by Grant Thornton India, it is happening. However, deal volumes have jumped 27 per cent so far this year, nearly doubling their value to $106 billion.
“While M&A deal activity saw an increase in deal volumes as compared to June 2022, which saw the lowest monthly volume in the last 19 months, deal value declined due to lack of high value transactions and non-disclosure of values. Viewed. most deals. On the other hand, YTD 2022 (YoY 2022) saw a 27% increase in deal volumes, almost doubling in value to $106 billion,” according to the Grant Thornton India DealTracker report.
Grant Thornton, Partner (Development) at India Shanti Winner said, “Like many other countries, Asia’s third-largest economy is also battling rising inflation, fueled by rising commodity prices. A weaker rupee has pushed up imported inflation. Nevertheless, start-ups, e-commerce and IT led the deal volume for the month, while infra, pharma, retail and banking sectors were the toppers in overall value.In the fintech segment this month Only one unicorn, Onecard, was born.
The report said that July 2022 saw a significant decline in M&A deals in terms of deal volume by 14 per cent to $280 million and deal value from 95 per cent to 32 deals. Consistent with previous months, M&A activity was dominated by domestic consolidation, which accounted for 84 per cent of M&A volumes and 92 per cent of values.
“Cross border transactions in terms of transaction volume and values were the second lowest recorded in the last 12 months due to global tensions. With 28 per cent of M&A deal volume, start-ups and the IT sector continued to dominate deal activity, with nine deals each totaling $162 million,” it said.
There were 139 deals worth $1.7 billion in the PE scenario. While PE transactions continued to account for over 80 per cent of the overall transaction activity, there was a significant drop in transaction values. The decline in funding was largely due to the absence of large investments and higher volume of deals in the early stage category, resulting in lower value per deal.
Year-on-year PE investments saw record activity in terms of volumes and values with 29 per cent and 3 per cent respectively from the previous record. The start-up sector continued to drive PE deal volumes with a 70 per cent stake with investment values of $0.6 billion for July 2022. The retail tech segment led the investment volume in the start-up sector with 20 per cent deals, followed by enterprise applications and infrastructure and fintech at 18 per cent each.
There have been 17 initial public offerings (IPOs) registered so far this year, with an issue size of $6 billion compared to $28. IPO Issues, YTD raised $7 billion in 2021. On the other hand, Qualified Institutional Placement (QIP) saw seven issues raise $677 million, while 24 issues raised $4.4 billion in YTD 2021. The fund is witnessing a decline in both IPO and QIP activities. Increase in activity through the respective routes as compared to the previous year.
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