India Inc's merger and acquisition activity is expected to continue to gather pace and reach USD 46.5 billion in 2017, says a report.
According to the Global Transactions Forecast issued by Baker McKenzie, India M&A is expected to reach USD 46.5 billion by way of 944 deals in 2017, boosted by Rosneft's USD 13 billion takeover of Essar Oil.
"M&A activity is expected to continue to gather pace on the back of Modi Government's continued efforts in removing regulatory hurdles and simplifying laws to further attract foreign investment, until it reaches its cyclical peak of USD 52.8 billion in 2019," the report said.
Pending the results of the 2019 national elections, there is potential for more ambitious economic reforms.
"The forecast for 2020 is therefore not set in stone and deal trends could move in either direction," the report added.
Meanwhile, Indian IPO market is set to reach the record- breaking value of USD 6.8 billion this year.
"The Indian IPO market continues to flourish as retail and institutional investors look for productive avenues to invest in a market with a shrinking interest rate, low bond yields, capped gold investments and real estate investments under scrutiny," it added.
"I think the flurry of IPO activities is likely to continue for the rest of this year and well into the early part of 2018, as corporate India seeks to take advantage of a surging Indian equity market," Ashok Lalwani, head of Baker McKenzies Global India Practice, said.
He further noted that "as the country prepares for the General Elections in 2019, I will not be at all surprised to see a surge of IPOs by private companies in the next few months before the deal window closes".
From a sector perspective, financials, industrials and healthcare have been some of the busiest sectors in terms of domestic listing, he said, adding that strong deal activity in these sectors and in real estate is expected in the next 18 months.
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