India’s private equity revival: Growth expected in H2 2025

A Grant Thornton Bharat report highlights stabilized valuations, renewed outbound M&A activity, and a rejuvenated IPO market set to boost India’s private equity landscape in the second half of 2025

New Delhi: Private equity activity in India is expected to bounce back in the second half of 2025 as market valuations stabilize and exit opportunities improve, according to a report by Grant Thornton Bharat.

In May, India recorded a total of 179 private equity deals worth $4.5 billion. Excluding IPOs and Qualified Institutional Placements (QIPs), 175 transactions were completed amounting to $4.2 billion, a 17% drop in deal volumes and a slight 4% decline in values compared to April.

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There are positive signs on the horizon, though. The report highlights that an increased number of outbound M&A deals reflects growing corporate confidence in global expansion and strategic diversification. “May marked a slowdown in overall deal activity due to muted private equity sentiment. The emergence of two unicorns and an uptick in Corporate India’s outbound deals indicate a promising deal outlook,” said Shanthi Vijetha, Partner, Growth at Grant Thornton Bharat. “Expect deal momentum to build in the second half in the backdrop of a rejuvenated IPO market.”

Mergers and Acquisitions (M&A) activity remained robust in May with 68 deals valued at $2.4 billion, a 75% increase in deal value compared to April, despite a marginal dip in transaction volumes by 1%. Outbound M&A, in particular, witnessed a significant jump. 15 deals were finalized in May, compared to just two in April, signaling a comeback in cross-border growth and integration after nearly a decade.

The sector also celebrated the debut of two unicorns, Drools Pet Foods and JSW One Platforms highlighting selective investor optimism amidst challenging times. On the other hand, the capital market was subdued with only two IPOs in May, raising $0.3 billion, mirroring the tepid activity of the previous month.

Within the deal landscape, the Banking and Financial Services sector played a starring role, accounting for 42% of the total deal value, bolstered by Sumitomo Mitsui’s $1.6 billion investment in YES Bank. The Retail and Consumer sector also maintained strong activity, driven by early-stage venture capital investments and major funding rounds like Citykart’s $68 million raise.

Overall, the report paints an optimistic picture for India’s private equity market, suggesting a strong resurgence in deal activity, renewed cross-border investments, and an improved IPO environment in the second half of 2025.