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Led by HDFC twins, India sees record $124-billion M&A deals in H1FY23

Last updated on: October 11, 2022 14:49 IST

Fuelled by the $57.8-billion merger of HDFC twins (HDFC Ltd and HDFC Bank), M&A (merger and acquisition) transactions in India touched a record high of $124.2 billion in the first half of 2022-23.

Merger and acquisition

Illustration: Uttam Ghosh/

Bankers said with several transactions, including the government's stake sale in IDBI Bank and Hindustan Zinc in the pipeline, the ongoing financial year will end up as the best year for M&A activity in the country.

Apart from the HDFC transaction, the $6.5-billion acquisition of Holcim stake by the Adani family and L&T’s $3.2-billion acquisition of Mindtree added to the record transactions in the first half of FY23.


A year ago, Indian companies reported M&A transactions worth $73.73 billion.

Bankers said the second half of the ongoing financial year will be led by government divestments.

“Apart from the big ticket sale of IDBI Bank and HZL, the government will sell its stake in logistics firm Corcor; mining major NMDC will sell its steel plant in the second half,” said a banker.

“The M&A outlook for the next 12 months remains robust given continued attractiveness of India as an investment theme, substantial availability of capital (albeit repriced) and moderated valuation, and is expected to be diversified across sectors.

"Financial sponsors and domestic corporates are expected to continue to dominate M&A flows in the next 12 months, though we are seeing re-emergence of activity from international corporates,” said Sourav Mallik, joint managing director, Kotak Investment Banking.

The recent exits of a few foreign companies from India due to changed priorities of their parents -- like Citibank’s sale of its retail operations to Axis Bank and Swiss cement major Holcim’s sale of its 63 per cent stake in Ambuja Cements to the Adani family -- also drove M&As. Analysts said MNCs’ declining presence in their respective markets, such as automobile, bank, and construction material, and restrictive FDI regulations in insurance also factored in the exits.

Analysts said these MNCs failed to build a meaningful presence in the Indian market given the strong local competition and/or their individual growth and investment strategies.

Despite these limitations, analysts said most MNCs continue to thrive in India which should drive strong foreign direct investment.

For example, Zurich Insurance has tied up with Piramal group to acquire Reliance General Insurance Company, which according to the administrator-appointed valuer is worth Rs 9,450

Dev Chatterjee in Mumbai
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