India's Deal Activity Starts 2026 with $7.2B, PE Shows Resilience

The report from Grant Thornton Bharat said India's deal ecosystem saw moderation in activity amid the absence of large-ticket transactions with volumes and value easing 11 per cent and 60 per cent respectively on a month-on-month basis.

The private equity landscape remained resilient with 126 deals valued at $2.7 billion, with sustained investor interest despite a softer overall deal environment.

The average PE deal size dropped to $21.6 million from $43.3 million in December, indicating a continued preference for smaller, growth and expansion-stage investments, the report said.

Excluding public market activity, 199 deals aggregated $5.9 billion, with volumes down 8 per cent and values down 56 per cent (month-on-month).

Capital markets, though cautious, remained accessible, with three IPOs raising $0.5 billion and five QIPs mobilising $0.8 billion, highlighting ongoing, albeit selective, avenues for capital deployment.

The report highlighted sector trends, noting that IT and ITeS led deal values with 19 deals worth $2.4 billion. Retail and Consumer remained the most active sector by volume with 39 deals, even as FMCG and food processing continued to attract interest.

Banking and Financial Services saw values correct to $466 million with 17 deals, reflecting a high base effect from December, while fintech activity remained resilient.

"January marked a measured start for India's deal landscape, due to absence of large-ticket transactions in the M&A space. While aggregate deal values moderated on a month-on-month basis, M&A deal activity remained selective and private equity demonstrated resilience through sustained volumes and continued engagement in growth and expansion capital," said Shanthi Vijetha, Partner, Growth, Grant Thornton Bharat.

Policy continuity, infrastructure-led growth, and capital formation priorities alongside expectations from the Union Budget 2026 and progress on the India-EU trade agreement are likely to shape dealmaking sentiment in early 2026, analysts said.

- IANS