India witnessed a downfall in terms of value of outbound deals in the year gone by, whereas there was a 35 per cent surge in inbound deals during 2014, according to Grant Thornton's 10th annual DealTracker report.
The total value of outbound deals in the country in 2014 stood at $5.9 billion (117 deals) down by 35 percent as compared to the mark of $ 9.2 billion in 2013, though volumes increased by 43 percent, the report said.
On the other hand, value of inbound deals in 2014 was at $ 11.8 billion, up by 35 percent compared to last year's value that stood at $ 8.7 billion.
The value of domestic deals in 2014 increased by 189 percent over 2013 with over 20 deals valued at over $ 100 million each, the report said.
"We saw a lot of outbound deals in 2008 and 2009. Then there was a lull and financing was a challenge and people involved in the deals then had some bad experience and hence they became careful while valuating before buying," Grant Thornton India's partner Harish HV said on Wednesday while unveiling the report.
The total M&A, private equity (PE) deals in 2014 were valued at $ 50 billion (1177 deals) as compared to $ 38 billion (947 deals) in 2013, the report said.
"We had almost $50 billion of deals in 2014. It shows that M&A is now a part and parcel of corporate strategy in India. Second big thing that we are seeing is huge growth in private equity (PE) activity which has grown from something less than $1 billion in 2005 to almost $12 billion this year which is again a huge jump," Harish added.
PE deal values in 2014 stood at $ 12 billion (604 deals) up by 23 percent compared to $ 10 billion (450 deals) in 2013 with more than 20 investments over $ 100 million each.
IT and ITES contributed 43 percent to the total PE values with E-commerce continuing to play a significant role in garnering PE investments, the report said.
"Outbound was a new trend for the country in 2014. But top 10 Indian corporate houses were looking for outbound M&A though in a selected pockets only," Grant Thornton India's partner Raja Lahiri said.
Some of the notable M&A deals during the year include Sun Pharmaceutical Industries' acquiring 100 percent stake in Ranbaxy Laboratories for consideration of $3,200 million in Pharma sector, TriZetto Corp's acquisition by Chennai-based Cognizant Technology Solutions for $2,700 million in the IT space and the Kotak-ING Vysya merger for $2,500 million in the banking arena during the year.
Notable PE deals include Flipkart raising $1.7 billion and Snapdeal raising $ 627 million both in the IT&ITES (E-commerce) sector.
The year also witnessed over 100 PE exits returning over $5 billion to investors, largely coming from the IT &ITES sectors.
The year saw 30 QIP deals raising over $5 billion and 35 IPOs.
With renewed focus on reforms, intrinsic growth and with capital markets looking up, 2015 could witness strong inbound interest with global players betting on the Indian growth story, the report said.