Monthly Dealtracker – May 2023

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India Inc recorded 106 deals valuing USD 4.6 billion in May 2023, a 45% decline in deal volumes and a steep 87% decline in deal values compared to May 2022 owing to the absence of big-ticket transactions. Unlike May 2022, which saw four multi-billion-dollar deals totalling USD 31.5 billion, May 2023 did not witness any such transactions. Domestic M&A volumes reached a three-year low with 20 deals, while cross-border M&A activity hit its lowest monthly volumes and values to date.

We are currently seeing persistent global macro-concerns centre around inflationary pressures in the US and eurozone. The global banking sector is already experiencing the impact of higher interest rates, because of which global deal-making has witnessed high levels of volatility and uncertainty. India is also experiencing a downturn in deal activity compared to the past year. While there has been an overall decline in the deal activity compared to past years, both M&A and PE volumes have witnessed a gradual m-o-m increase since February 2023. In addition, the government's emphasis on regulatory reforms to enhance the ease of doing business, combined with the country's robust fundamentals, create a strong foundation for deal-making in India, said Shanti Vijetha, Partner, Growth, Grant Thornton Bharat.

Key highlights:

  • The M&A deal activity in the month experienced a significant decline, with a 45% decrease in deal volumes and a notable 98% decrease in deal values compared to May 2022, recording only 22 deals valued at USD 675 million.
  • Despite a 44% decrease in investment volumes and a 45% decline in values compared to May 2022, recording 84 deals that raised USD 3.9 billion, private equity (PE) investment activity has been gradually increasing since February 2023, which recorded 65 deals.
  • May 2023 saw only one initial public offering (IPO), raising USD 390 million and two issues of qualified institutional placements (QIPs) valued at USD 42.7 million.