Private equity (PE) remained comparatively stable in Q2, clocking 357 deals worth $7.4 billion — the second-highest volume since Q4 2022. However, deal values dipped on a quarter-on-quarter basis due to the absence of high-value transactions that characterized Q1
India Inc. is expected to witness a rebound in deal activity in the second half of 2025, driven by easing geopolitical tensions, strong macroeconomic fundamentals, and renewed investor interest, according to a report by Grant Thornton Bharat released on Wednesday.
Despite a muted second quarter marked by global uncertainties, the report highlights growing resilience, particularly from foreign investors leading inbound mergers and acquisitions (M&A) and a late-quarter revival in public market activity.
In Q2 2025, India recorded 582 transactions (including IPOs and Qualified Institutional Placements) valued at $17 billion, down from 554 deals worth $12.8 billion in the previous quarter. This represented a 13 per cent decline in volume, attributed to continued global volatility — including the Iran-Israel conflict, persistent policy uncertainty in the US, the ongoing Russia-Ukraine war, and high gold prices — all of which contributed to heightened investor caution.
“The second quarter of 2025 was marked by a cautious investment environment influenced by global uncertainties,” said Shanthi Vijetha, Partner, Growth at Grant Thornton Bharat. “Despite the slowdown, the sustained momentum in private equity investments, the emergence of new unicorns, and a promising uptick in public market activity towards the quarter-end are encouraging indicators.”
Vijetha noted that consistent activity in banking and infrastructure reflects continued investor confidence in India’s long-term growth story. “Looking forward, we remain optimistic that easing external pressures and strong domestic fundamentals will drive deal activity in the coming months.”
Private equity (PE) remained comparatively stable in Q2, clocking 357 deals worth $7.4 billion — the second-highest volume since Q4 2022. However, deal values dipped on a quarter-on-quarter basis due to the absence of high-value transactions that characterized Q1.
M&A activity continued its subdued trend, with 197 deals valued at $5.4 billion. Notably, the quarter saw just one billion-dollar deal: Sumitomo Mitsui Banking Corporation’s $1.57 billion investment in YES Bank, which contributed significantly to the quarter’s total value.
The banking sector was a standout performer, accounting for nearly half the M&A value with three high-ticket deals. Also of note was Zaggle Prepaid Ocean Services, which pursued a bold domestic acquisition strategy across IT, banking, and media—signaling a differentiated consolidation play amid broader market softness.
Fundraising through public markets remained cautious in Q2, with IPO activity declining for the third consecutive quarter. However, June showed signs of recovery, notching the second-highest monthly IPO volumes and values for 2025. This late momentum suggests investor sentiment may be turning.
On the QIP front, performance remained stable with 16 issuances raising $2.2 billion — nearly matching the previous quarter. Banking once again led the way, accounting for 49 per cent of QIP proceeds. Six banks together raised $1.1 billion, underlining continued institutional appetite for the sector.
As geopolitical turbulence shows signs of stabilizing, Grant Thornton anticipates a strong rebound in dealmaking in the months ahead. The firm points to India’s resilient economy, sectoral opportunities in banking, infrastructure, and IT, and foreign investor confidence as key growth drivers.
With a mix of cautious optimism and accelerating interest across sectors, the second half of 2025 could mark a turning point for India Inc.’s investment landscape.
