India

What you need to know

• Sector concentration: M&A activity in India has remained robust, with 70% of deal activity concentrated in the Industrials, Energy and Natural Resources, and Financial Institutions sectors.
• Fewer, bigger deals: The first half of 2026 saw 480 deals complete, worth around INR 7392.36 billion. While deal volumes declined by 27% as compared to their 2025 levels, deal values went up by 15%, marking a shift towards fewer, high-value transactions, and indicating a trend towards consolidation.
• Foreign private capital inflows: 2026 was characterised by foreign private capital investing in India's growth story, further bolstered by liberalisation in India's foreign direct investment norms, particularly the opening up of the insurance sector. This was offset by foreign portfolio investors looking for exit opportunities.
• Outbound expansion: Outbound activity noted a material increase from 2025 levels, and was dominated by Indian companies making strategic outbound acquisitions for business expansion.
• Deal-friendly reforms: Regulatory reforms relating to foreign investment and M&A financing, and conclusion of bilateral free trade agreements with the United Kingdom and the European Union signal India's commitment to promote a deal-friendly environment in alignment with global standards.

The M&A state of play

M&A activity across Indian markets has remained robust, with certain sectors delivering consistent growth, despite geopolitical uncertainty and market volatility in the region.

The first half of 2026 saw 480 deals complete, with an aggregate disclosed value of ~INR 7392.36 billion. While this is a 27% decline in deal volume, there has been a 15% increase in value, as compared to the first half of 2025 which saw 659 deals complete, with an aggregate disclosed value of ~INR 6,433.19 billion. This marks a shift towards fewer, high-value transactions, indicating a trend towards consolidation.

This fall in deal volume levels is consistent with global trends, indicating uncertainty in the region arising from the ongoing conflict in the Middle East, and a volatile macroeconomic environment due to trade and tariff uncertainties and devaluation of the Indian Rupee. However, despite the headwinds, the capital markets are flourishing, with no signs of slowdown in IPOs. With the Indian economy continuing to grow at around 7% per annum, the market for deals is expected to remain robust in the coming months.

2026’s market-defining transactions

Despite the uncertainty, the Indian M&A market continues to be characterized by mega deals, with the top 10 completed deals in the first half of 2026 ranging from deal values of INR 137.8 billion to INR 1957.7 billion.

This period saw Vedanta’s large-value internal reorganization, with Vedanta Limited demerging its aluminum, power, and oil & gas businesses for INR 1,957.70 billion, INR 160.10 billion and INR 144.90 billion respectively. The demerger became effective in May 2026 and the shares of the demerged entities commencing trading shortly thereafter.

Other key completed deals include MUFG’s acquisition of 20% preference shareholding in Shriram Finance, the India-based provider of loans for automobiles, trucks, and business, for INR 396.2 billion, the INR 290.20 billion merger of Aster DM Healthcare and Blackstone-backed Quality Care India Limited, and Emirates NBD Bank’s INR 268.50 billion acquisition of a majority stake in RBL Bank.

Additionally in 2026, Sun Pharmaceutical, an India-based pharma manufacturer, announced the acquisition of Organon, a listed US healthcare company for INR 1,166.05 billion. On similar lines, Canada Pension Plan Investment Board, along with a private investor, entered into definitive agreements to acquire the remaining stake in ReNew Energy Global, an India-based renewable energy producer, for INR 895.50 billion, and Power Finance Corp, an Indian government-owned finance provider, announced a merger with REC Limited, for a consideration of INR 474.70 billion.

The top 10 completed deals by value between January 2026 to June 2026 are set out below:

Source: Mergermarket

Strong sectoral recovery

While overall levels have trended downwards, there has been a positive trend in industrials, financial institutions, and energy and natural resources sectors, which have dominated the dealmaking space in 2026, collectively driving 70% of all M&A activity.

Infrastructure activity in the industrial sector, in particular, has been a notable driver, with deal volumes of INR 2,788.96 billion represented across 112 deals in the first half of 2026. The trends demonstrate strong interest by large private players, both conglomerates such as the Adani Group, as well as private funds based in India and abroad to acquire interests in both infrastructure assets (e.g., highways and railways) and related service provider entities – reflecting a continued commitment to India's development story – as evidenced by the acquisition of a portfolio of assets across southern states in India by National Highways Infrastructure Trust for INR 62.21 billion.

Interestingly, the technology sector has ranked second by deal count for H1 2026, with 84 deals valued at INR 549.30 billion, demonstrating increasing activity in the midmarket. This is driven primarily by acquisition of minority interests in data centre operators, including the acquisition by Airtrunk Australia (through its Singapore subsidiary) of 12% stake in Lumina Cloudinfra, from Blackstone, and Princeton Digital Group's acquisition of Everyondr Development Management from Everstone Capital.

The opening up of the insurance sector on the regulatory front has also resulted in a clear uptick in M&A activity as a consequence, with Indian consolidation of outgoing foreign JV partners and entry of new foreign capital (e.g., JC Flowers’ acquisition of Niyam Group, led by Ashurst Perkins Coie).

Foreign PE's bet on India and India Inc goes global

The beginning of 2026 has been characterized by two key trends as to the M&A players – foreign private capital looking to invest in India, and Indian acquirers looking to expand abroad.

There has been a noticeable increase in foreign private equity capital over 2025 levels – the first half of 2026 saw 78 private equity entry deals with a disclosed value of INR 1,664.48 billion (a 271% increase compared to the first half of 2025). These investments lie across multiple sectors, including industrials, energy and natural resources, banking and consumer and retail. At the same time however, it should be noted that there has been a dip in foreign portfolio investment in India on the back of a devalued Indian Rupee and possibilities of higher returns in global markets.

Outbound activity by Indian acquirers has also increased materially compared to the first half of 2025. In the first half of 2026, Indian acquirers completed 114 outbound M&A transactions valued at INR 2,044.52 billion – an increase of 16% by deal count and a staggering 267% by deal value. The numbers reflect the increasing ambitions of Indian companies to diversify and expand their businesses abroad – the largest of these is the expansion of Sun Pharmaceutical through the acquisition of Organon in the United States, the latest in a series of foreign acquisitions in 2026. Among these, the United States was the leading outbound destination, followed by the United Kingdom and Germany.

Regulatory reforms signal a positive outlook for foreign investment

The start of 2026 saw the removal of the 74% foreign ownership ceiling in the insurance sector, with 100% foreign direct investment now being permitted in the sector. The Reserve Bank of India has also proposed replacing India’s foreign investment rules entirely, with new draft rules in the pipeline which propose streamlining and simplifying foreign investment frameworks. These changes are expected to significantly liberalize the market for M&A deals, particularly for foreign insurers looking to enter the Indian market.

India has also clarified foreign direct investment restrictions for countries which share a land border with India, permitting up to 10% non-controlling beneficial ownership from these countries. This is expected to ease regulatory compliance burdens, particularly for private equity funds looking to invest in India who may have minority sponsors domiciled in China, and in particular, Hong Kong and Taiwan.

The RBI has also enacted several banking reforms which impact India’s M&A landscape. This includes regulatory frameworks permitting Indian banks to finance M&A acquisitions, and overhauling the external commercial borrowings (ECB) framework in India. With this, Indian M&A’s historical dependency on offshore lenders or private credit is expected to reduce, with the increase in availability of funding from domestic banks. The ECB reforms have also built in permissions to use proceeds raised from foreign lenders to finance domestic M&A transactions. Ashurst Perkins Coie has recently represented an international bank on two facilities to an India-based textiles company, in relation to financing the acquisition of the US-based company in full compliance with the new ECB framework.  

India's efforts on the global front have also resulted in the conclusion of bilateral free trade agreements with the United Kingdom and the European Union. While the EU-India agreement is yet to be formally ratified, the UK-India agreement entered into force earlier this year. These trade agreements are expected to significantly liberalize tariffs and provide greater reciprocal non-tariff benefits, thereby bolstering trade between these blocs.

India’s ongoing efforts to enact regulatory reforms reflect its ambitions to create a deal-friendly environment which is in alignment with global standards and to facilitate ease of doing business. Given its overall positive growth trajectory, it is expected that M&A activity will continue to be robust, with consolidation across sectors and resilient recovery, despite geopolitical headwinds.