India Sees Uptick in PE Investment, M&A Deals

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Aug. 4 – Recent market results show a significant pickup in private equity investment and inbound M&A deals in India. Following the previous year’s global slowdown, figures posted for the latest fiscal year are showing positive growth, highlighted by particularly strong private equity investment, worth US$4.2 billion to date. However, rising interest rates have tempered expected returns by Indian companies who now need to settle for less for their growth capital.

Furthermore, the value of inbound M&A deals in India has more than doubled so far this year when compared to the same period last year, reaching US$26 billion. As such, India now only trails China in attracting inbound M&A deals among emerging markets. Acquirers from the United Kingdom are leading the trend with investments of US$15.6 billion, followed by those from the United States, Germany and Japan. It is worth noting that this represents a change from the previous year in which the United States was the majority source of M&A deals in India.

Notable investments include Franklin Templeton’s newly acquired 20 percent stake in Kimaya Fashion and Blackstone Group’s US$110 million investment in the Indian electricity producer VISA Power Ltd. as well as their US$33 million investment in Mumbai-based Financial Inclusion Network & Operations Ltd.

The Indian healthcare industry is also proving to be a draw for foreign investors, as domestic demand is on the rise and services continue to improve and develop. Similarly, aging water related infrastructure is driving up demand by the government, local and above, for new technology and equipment.

Dezan Shira & Associates is boutique professional services firm providing foreign direct investment business advisory, tax, accounting, payroll and due diligence services for multinational clients in India. To contact the firm, please email, visit, or download the firm’s brochure here.