INDIA Trends and Developments Contributed by: Kunal Chandra, Kabeer Mathur, Chinmay Bilgi, Sharnam Vaswani and Rajdeep Mukherjee, Trilegal
Despite an increasingly turbulent global economic environment affected by geopolitical tensions and shifting tariff regimes, 2025 saw India emerge as a resilient and attractive market for M&A. India’s strong domestic demand, sustained GDP growth and steady monetary policy underpinned a stable investment environment, sustained investor confidence and growth in deal values. India recorded 963 M&A trans - actions in 2025, with total deal value reaching approxi - mately USD60.2 billion and the deal count increasing by about 41% year on year. Indian M&A in 2025 was shaped by the following key themes that were visible across the market: • Geopolitics and trade policy: Tariff volatility and geopolitical uncertainty are reshaping deal struc - tures and documentation, while India’s positioning as a China Plus One destination and progress on trade agreements are attracting fresh cross-border investment. • Shift from minority to control investments: Inves - tors are moving away from passive minority stakes towards larger, control-oriented transactions where they can actively influence operations and strategy. • Exit options maturing: The combination of a robust strategic sales market and a deepening initial pub - lic offering (IPO) market has created multiple viable exit routes, increasing investor confidence and the willingness to deploy larger capital. • Domestic consolidation: Domestic M&A reached record levels, driven by consolidation in pursuit of efficiency rather than by diversification, with manufacturing being particularly active as compa - nies localised supply chains and scaled to meet government incentive thresholds. • Financial services M&A: The financial services sec - tor saw foreign institutions making strategic entries into India’s growing credit economy and domestic players consolidating to strengthen their competi - tive positioning. • Outbound M&A: Indian corporates deployed signif - icant capital abroad to acquire technology, brands and operating capabilities, driven by competitive necessity rather than geographic diversification. • Infrastructure, real estate and energy: Investors increasingly prioritised assets offering predict - able, long-term cash flows, with record institutional
investment reflecting a broader preference for stability over speculative growth. • Technology and AI transactions: Technology M&A strengthened significantly, with artificial intelli - gence (AI) acquisitions accelerating as companies sought to embed digital capabilities quickly, while AI-related IP concerns are beginning to shape due diligence and deal documentation. • Data centres and GCCs: Significant capital flowed into data centre platforms, while global capability centres (GCCs) continued to evolve into strategic technology hubs, with policy support expected to generate a new category of capability-led M&A transactions. • ESG considerations: Environmental, social and governance (ESG) expectations from foreign investors and multinational buyers are increasingly shaping diligence and post-acquisition integra - tion, though uneven implementation across India’s mid-market means global standards often require significant operational adjustment. • Acquisition financing: A new Reserve Bank of India (RBI) framework permitting domestic banks to finance share acquisitions marks a meaningful structural shift, with the potential to expand deal sizes, improve pricing and support the develop - ment of a leveraged finance market in India. • FDI reforms: Targeted liberalisation in insurance and space, alongside pragmatic amendments to the screening regime for investments from land- bordering countries, has reduced friction in execu - tion and unlocked previously constrained capital flows. • Data protection (DPDP Act): The implementation of India’s revised data protection framework has cre - ated a dedicated diligence workstream in relevant sectors, with buyers increasingly seeking con - tractual protections for legacy data practices and factoring remediation costs into pricing. • Evolving regulatory landscape and deal execution dynamics: Dealmaking in India is becoming more sophisticated, with increased use of warranty and indemnity (W&I) insurance as a risk allocation tool. Regulatory shifts are improving deal execution and capital access. At the same time, evolving compli - ance regimes and labour law reforms are adding complexity to the nature and scope of diligence
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