Indian Outbound M&A Reaches $11 Billion, Driven by Strategic Planning
Indian firms have completed nearly 100 outbound M&A deals worth $11 billion, following 120 deals valued at $17 billion. Companies are prioritizing strategic planning over risk-taking, focusing on deals with strong strategic fitment. Key drivers include gaining technology, market access, and better products. Acquisitions target capability gaps, enhancing global competitiveness. Strong cash flows and financial buffers support continued M&A activity.
*this image is generated using AI for illustrative purposes only.
Indian companies are maintaining strong momentum in outbound mergers and acquisitions (M&A), with nearly 100 deals worth $11.00 billion completed. This trend follows a robust performance which saw 120 deals valued at $17.00 billion.
Strategic Focus Over Risk-Taking
Industry experts highlight a shift in approach among Indian firms, prioritizing strategic planning over risk-taking in their M&A activities. Companies are now focusing on deals with strong strategic fitment rather than pursuing value arbitrage plays.
Sumeet Abrol from Grant Thornton Bharat noted, "Indian corporates now have enhanced capabilities to manage M&A risks." He emphasized that deal discipline has prevented billion-dollar gambles on untested business models, indicating a more mature approach to international acquisitions.
Key Drivers of Outbound M&A
Bhavesh Shah from Equirus pointed out that Indian companies are pursuing international acquisitions to gain:
- Technology
- Market access
- Better products
Shah also mentioned that global trade shifts, including US tariffs, are influencing these M&A strategies.
Addressing Capability Gaps
Many of these acquisitions are targeting serious capability gaps within Indian companies. This strategic approach allows firms to enhance their competitive position in the global market.
Financial Stability Supporting M&A Activity
Despite the significant outlay, Indian companies are maintaining strong cash flows and financial buffers. This financial stability is crucial in supporting continued outbound M&A activity, allowing firms to pursue strategic opportunities without compromising their financial health.
Outlook
The consistent pace of outbound M&A deals suggests that Indian companies are committed to expanding their global footprint. With a focus on strategic fit and capability enhancement, this trend is likely to continue as Indian firms seek to strengthen their position in the international business landscape.
As global economic conditions evolve, it will be interesting to observe how Indian companies adapt their M&A strategies to capitalize on emerging opportunities while managing potential risks in the global market.
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