India has become one of the world’s leading markets for deals such as initial public offerings, which this year broke its own record for the amount of money raised by investors seeking opportunities.
Giant Mega Mart Ltd’s trading debut on Wednesday highlighted this insatiable appetite for IPOs – with the retailer’s shares surging more than 40%. According to several women in the front rows, the feeding frenzy is set to begin in 2025.
“We are gearing up for another busy year, both in terms of IPOs and M&A,” said Sonia Dasgupta, managing director and chief executive officer, investment banking at JM Financial Ltd.
Dasgupta was speaking during a roundtable discussion with other women leaders in Mumbai, who were talking about India dealmaking and their role in powering the boom.
“Organizations that are able to attract, retain and nurture women have the advantage of a larger and better talent pool,” said Dasgupta. She said her company’s meritocratic system “always prevails”, resulting in significant participation of women at various levels.
“In the end, it comes down to one’s ability and expertise,” added Surbhi Kejriwal, partner at law firm Khaitan & Company.
Dasgupta said that on the deals front, multinational companies are looking at various options to improve performance, including market exits, stake sales or expansion.
More than $19 billion has been raised in IPOs in India since January, breaking the previous annual record of $17.8 billion in 2021. These include the country’s largest ever listing, with Hyundai Motor Co. Its local unit raised $3.3 billion. Two others – food delivery firm Swiggy Ltd and NTPC Green Energy Ltd – also topped $1 billion, while megamart giant was not far behind.
Strong economic growth has attracted global investors, and billions of dollars poured into domestic mutual funds each month have supported equity markets even as some foreigners have been selling. The benchmark Sensex is up nearly 10 percent in 2024 and is surely destined for a ninth consecutive year of gains.
“The level of IPO activity in 2024 has been unprecedented, thanks in part to increased demand from institutional and retail investors,” said Dharvi Kanbar Shahra, founder of family office DHSK Advisors. It came in handy when forming a family, especially for women.
“As a mother of very young children, finding the right work-life balance is key,” she said.
More deals
More IPOs are on the horizon. According to people familiar with the matter, LG Electronics Inc. is considering raising the value of its Indian unit to $15 billion in a listing in Mumbai next year, and Carlyle Group Inc. is said to is weighing an IPO of an engineering services firm. Quest Global Services Pte.
Not all IPOs have made spectacular gains. After its record attempt, Hyundai India is trading below its offer price of Rs 1,960 per share. But the winners easily outnumber the losers in large IPOs. Bajaj Housing Finance Ltd is more than 80% above its offer price after listing in September, and both Bharti Hexacom Ltd and Swiggy have made significant gains.
Kejriwal of Khaitan said an increasing share of activity could shift towards mergers and acquisitions, particularly in the infrastructure, healthcare and consumer sectors.
The volume of M&A deals targeting Indian firms rose 19 percent to $42.3 billion this year, data compiled by Bloomberg show. Quality Care India Ltd., which is backed by Blackstone Inc., acquired Aster DM Healthcare Ltd. in November. agreed to an all-stock deal to create one of India’s largest hospital chains.
A Blackstone-led consortium also emerged as the preferred bidder for a stake in Haldiram Snacks Pvt., people familiar with the matter said. said, after months of negotiations.
Adani Group this week announced plans to consolidate its cement operations by merging two units under Ambuja Cements Ltd as billionaire Gautam Adani consolidates a business that is key to India’s infrastructure development. .
“We expect a lot of M&A activity in 2025, with financial sponsors accounting for the bulk,” Kejriwal said. “We are seeing increased interest from global investors, which is likely to help India remain a hotspot for dealmaking in Asia.”