India Leads Asia-Pacific Financial Sector M&A Deals in Q1 2024

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In the dynamic landscape of mergers and acquisitions in the Asia-Pacific region during the first quarter of 2024, India shines as the frontrunner, surpassing other key players such as Japan, Australia, South Korea, and Mainland China.

According to data from S&P Global Market Intelligence, India closed a total of 27 deals, showcasing a significant uptick compared to its counterparts.

India’s Dominance in Q1 2024

Despite a 14% year-on-year decline in overall deal volumes, India emerged as the standout performer in the financial sector mergers and acquisitions arena.

The country’s resilience and optimistic economic forecast paved the way for robust deal-making activities. While other nations experienced a decrease or stagnation in deal numbers, India’s trajectory pointed upwards, with one more deal closed compared to the previous year.

Factors Behind the Slowdown

Economic uncertainties, coupled with higher funding costs and increased volatility due to geopolitical tensions, contributed to the overall slowdown in deal volumes across the Asia-Pacific region.

Mainland China and Australia experienced notable declines, with Mainland China seeing a drastic drop from 24 deals in the previous year to just nine in Q1 2024.

India’s Top Deals

India secured its position with four of the top 10 deals in terms of value. The largest among them was Sumitomo Mitsui Financial Group’s acquisition of SMFG India Credit, a specialty finance company, for a staggering $700 million.

Other notable deals include Piramal’s acquisition of Annapurna Finance, Rajiv Rattan’s stake purchase in RattanIndia Finance, and Muthoot Finance’s investment in Belstar Microfinance.

Outlook on India’s Growth

Chief Economic Adviser V Anantha Nageswaran, at an NCAER event, expressed optimism about India’s economic growth, projecting a GDP growth rate of 8% for FY24.

With robust growth registered in the first three quarters, surpassing IMF and RBI estimates, India’s economic trajectory appears promising, positioning it as a key player in the global financial landscape.

Looking ahead to FY25, IMF forecasts 6.8% growth, while RBI expects 7%, potentially marking the fourth consecutive year of 7% or higher growth. Nageswaran emphasized the importance of monsoon patterns and infrastructure investment, foreseeing sustained growth between 6.5-7% beyond FY25.