India's January M&A and PE activity jumps 55%

India`s mergers and acquisitions (M&A) and PE (private equity) activity last month rose by around 55 per cent to $3.01 billion worth of transactions, a report said on Saturday.

According to Grant Thornton`s annual dealtracker report, the industry in January witnessed $3.01 billion worth of transactions spread across 124 deals.

In the same month in 2016, the country`s M&A and PE activity recorded 139 deals worth $1.94 billion.

"January witnessed around 125 transactions contributing over US$3 bn, which is a 55 per cent increase in values over the same month last year," Prashant Mehra, Partner at Grant Thornton India, was quoted as saying in a statement.

"The primary growth driver continues to be domestic M&As, which contributed over US$1.6 bn and over four times of the growth."

The assurance, tax and advisory firm`s report disclosed that the domestic M&A momentum during the month under review aggregated to $1.61 billion across 23 deals, as against $0.37 billion across 24 deals in the corresponding period of last year.

Mehra cited that PE activity, on the other hand, continued to slip away both from a volume and value perspective.

"January saw around 80 transactions contributing just about US$650,000. This was a 40 per cent drop in value from last year," said Mehra.

"Cross-border activity seems to be an equal mix between inbound and outbound, contributing around half a million dollars."

Looking forward, Mehra predicted that with the visibility on GST (Goods and Services Tax) and fading effect of demonetisation, combined with the "pragmatic" Union Budget, domestic consumption and growth should see further acceleration.

"This will increase traction in domestic M&As as well as inbound investments. With specific boost to infrastructure, FDI (Foreign Direct Investment) and more money in the hands of the people, 2017 should be a very exciting year for deal making," he added.